Competition effects of price liberalization in insurance

Research output: Contribution to journalArticle

6 Citations (Scopus)

Abstract

Insurance services have a prominent role in modem societies. Empirical evaluation of market interactions in insurance is, however, scarce. To fill this gap, two models are proposed. Each captures the main features of either regulated or deregulated markets. Three levels of decisions (reinsurance, sales effort and prices) generate testable predictions on firm behaviour with respect to sales effort choices. Recent evolution of the Portuguese market provides a natural data set for application. Estimation before and after price deregulation reveals a noticeable change in behaviour. Coordination has characterized the interaction under price regulation. Competition between firms has increased after deregulation.

Original languageEnglish
Pages (from-to)267-287
Number of pages21
JournalJournal of Industrial Economics
Volume44
Issue number3
DOIs
Publication statusPublished - Sep 1996

Keywords

  • INDUSTRY
  • BEHAVIOR
  • MARGINS
  • MARKET
  • IMPACT
  • COST

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