Investigating the stationarity of insurance premiums: international evidence

Insurance market density and economic growth in Eurozone countries: the granger causality approach

“…Here, the Granger causality runs from insurance market activities to economic growth. The studies supporting SLH are Alhassan and Biekpe (2016), Pradhan et al (2017Pradhan et al ( , 2015, Alhassan and Fiador (2014), Chang et al (2014), Lee et al (2013aLee et al ( , 2013b, Guochen and Wei (2012), Lee (2011), Adams et al (2009), Kugler and Ofoghi (2005), and Boon (2005).…”

“…First, the affordability 5 of insurance; second, the amount of regulation imposed on the insurance industry by the host government; third, the amount of risk and uncertainty that the people in the society perceive in their lives; and fourth, the degree to which these individuals want to minimize these perceived risks by purchasing insurance rather than relying on the other mechanisms to hedge risks (see, inter alia, Pradhan et al 2017;Lee et al 2013aLee et al , 2013bPark et al 2002;Soo 1996). At the empirical level, a large section of finance-growth work assesses the impact of the banking sector on economic growth.…”

“…The insurance market activities-both as a provider of risk transfer and indemnification and as an institutional investor-may contribute to economic growth in the following ways: promoting financial stability, facilitating trade and commerce, mobilizing domestic savings, allowing different risks to be managed more efficiently, encouraging the accumulation of new capital, fostering a more efficient allocation of domestic capital, and helping to reduce or mitigate losses (see, inter alia, Pradhan et al 2015aPradhan et al , 2015bLee et al 2013aLee et al , 2013bBillio et al 2012;Guochen and Wei 2012;Haiss and Sumegi 2008;Skipper and Kwon 2007;Kugler and Ofoghi 2005;Ward and Zurbruegg 2000). Additionally, there may be different effects on economic growth from life and non-life insurance market activities given that these two types of insurance market activities protect the households and corporations from different kind of risks that affect the economic activity in different ways.…”

“…The motivation for this study is based on two typical reasons. First, the coverage of insurance sector has gained less attention in the finance-growth literature, particularly in comparison to both banking sector and stock markets (see, inter alia, Lee et al, 2013aLee et al, , 2013b. Second, with the process of financial liberalization and integration, we have witnessed an increasingly rapid growth in the insurance market activity during last few years, which raises the question of 'whether insurance market activity promotes economic growth.'…”

“…3 Most of these studies have argued that economic growth is characteristically determined by insurance market activities, with sufficient evidence presented to policymakers to this effect (see, inter alia, Arena 2006; Beck and Webb 2003;Chen et al 2013;Hussels et al 2005). However, in extant literature, the link between insurance market activities and economic growth has not been fully recognized, and most empirical results vary according to data and econometric tools (see, inter alia, Lee et al 2013aLee et al , 2013bOutreville 2013). There is no universally held view of the nature of causality between insurance market activities and economic growth (see, inter alia, Pradhan et al 2017;Alhassan and Fiador 2014;Chang et al 2014;Kugler and Ofoghi 2005;Ward and Zurbruegg 2000).…”