scholarly journals LIFE INSURANCE DEVELOPMENT AND ECONOMIC GROWTH: EVIDENCE FROM DEVELOPING COUNTRIES

2018 ◽  
Vol 43 (2) ◽  
pp. 1-28
Author(s):  
RELWENDÉ SAWADOGO ◽  
IDRISSA M. OUEDRAOGO ◽  
SAMUEL GUERINEAU
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Life Insurance ◽  
Insurance Development

scholarly journals Life insurance, financial development and economic growth in South Africa: An application of the autoregressive distributed lag model

2014 ◽  
Vol 4 (4) ◽  
pp. 81-90 ◽  
Author(s):  
Athenia Bongani Sibindi
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Granger Causality ◽  
Financial Development ◽  
Life Insurance ◽  
Insurance Sector ◽  
Long Run ◽  
Short Run ◽  
Per Capita ◽  
Insurance Development

The life insurance sector may contribute to economic growth by its very mechanism of savings mobilisation and thereby performing an intermediation role in the economy. This ensures that capital is provided to deficient units who are in need of capital to finance their working capital requirements and invest in technology thereby resulting in an increase in output. In this way, it could be argued that life insurance development spurs financial development. In this article we investigate the causal relationship between the life insurance sector, financial development and economic growth in South Africa for the period 1990 to 2012 by applying the ARDL bounds testing procedure. We make use of life insurance density as the proxy for life insurance development, real per capita growth domestic product as the proxy for economic growth and real broad money per capita as the proxy for financial development. We test for cointegration amongst the variables by applying the bounds test and then proceed to test for Granger causality based on the error correction model. Our results confirm that the variables are cointegrated and move in tandem to each other in the long-run. The results also indicate that the direction of causality runs from the economy to the life insurance sector in the short-run which is consistent with the “demand-following” insurance-growth hypothesis. There is also evidence of bidirectional Granger causality running from the economy to financial development and vice versa, both in the long-run and short-run. The results also reveal that life insurance complements financial development in bringing about economic growth further lending credence to the “complementarity” hypothesis.

scholarly journals The Impact of the Life Insurance on Economic Growth in ASEAN

2018 ◽  
Vol 2 (2) ◽  
pp. 12-15
Author(s):  
Karin Amelia Safitri
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Life Insurance ◽  
Insurance Industry ◽  
Developed Countries ◽  
Fixed Effect Model ◽  
Insurance Premium ◽  
Insurance Companies ◽  
Positive Effects ◽  
The Impact

The development of the insurance business in ASEAN has an impressive growth in the course of recent years. Reverse statement from Ouédraogo et al., (2016) who explained the level of life insurance development in developing countries remains low comparatively to developed countries. The ASEAN insurance industry, with the increasing number of insurance companies and people using insurance services, can even play a greater role in supporting overall economic growth in that region. This study aimed at examining the contribution of life insurance sector which is measured by three parameters e.g insurance penetration, insurance density and premium volume to the economic growth in the sample of 6 developing countries on ASEAN religion during 2005-2015 period i.e. Singapore, Malaysia, Phillipine, Thailand, Vietnam and Indonesia. The analytical method is applied by using fixed effect model. The result of this study showed that the life insurance premium volume, penetration and density have positive effects on economic growth.

scholarly journals Life insurance, financial development and economic growth in South Africa

2014 ◽  
Vol 4 (3) ◽  
pp. 7-15 ◽  
Author(s):  
Athenia Bongani Sibindi
Keyword(s):  
Economic Growth ◽  
South Africa ◽  
Financial Development ◽  
Life Insurance ◽  
Capital Requirements ◽  
Insurance Sector ◽  
Insurance Density ◽  
Per Capita ◽  
Insurance Development ◽  
Growth Hypothesis

The life insurance sector may contribute to economic growth by its very mechanism of savings mobilisation and thereby performing an intermediation role in the economy. This ensures that capital is provided to deficient units who are in need of capital to finance their working capital requirements and invest in technology thereby resulting in an increase in output. In this way, it could be argued that life insurance development spurs financial development. In this article we investigate the causal relationship between the life insurance sector, financial development and economic growth in South Africa for the period 1990 to 2012. We make use of life insurance density as the proxy for life insurance development, real per capita growth domestic product as the proxy for economic growth and real broad money per capita as the proxy for financial development. We test for cointegration amongst the variables by applying the Johansen procedure and then proceed to test for Granger causality based on the vector error correction model (VECM). Our results confirm the existence of at least one cointegrating relationship amongst the variables. The results indicate that the direction of causality runs from the economy to the life insurance sector which is consistent with the “demand-following” insurance-growth hypothesis. There is also evidence of causality running from the economy to financial development which is consistent with the “demand following” finance-growth hypothesis. The results also reveal that life insurance complements economic growth in bringing about financial development further lending credence to the “complementarity” hypothesis.

scholarly journals The Impact of Regulatory Quality on the Nexus between Life Insurance Development and Economic Growth: Evidence from European Developing Countries

2020 ◽  
pp. 141-152
Author(s):  
Gengnan Chiang ◽  
Chin-Chi Liu
Keyword(s):  
Economic Growth ◽  
Life Insurance ◽  
Smooth Transition ◽  
Growth Effect ◽  
Governance Indicators ◽  
Regulatory Quality ◽  
Smooth Transition Regression ◽  
The Impact ◽  
The Relationship ◽  
Insurance Development

The purpose of this study is to explore whether the regulatory quality influences the relation between life insurance development and economic growth by applying a nonlinear panel smooth transition regression (PSTR) model. Using the data from Worldwide Governance Indicators (WGI) to assess the soundness of regulatory quality, this paper finds that the relationship between life insurance development and economic growth is significantly positive in the countries with relatively better regulatory quality. Our findings not only indicate that sound regulatory quality could encourage the growth effect of life insurance sectors but also have far-reaching practical implications for other economies to realize regulatory quality should matter for the development of the economic growth.

Impact Of Insurance On Economic Growth: The Case Of Republic Of Macedonia

2012 ◽  
Vol 4 ◽  
Author(s):  
Jordan Kjosevski
Keyword(s):  
Economic Growth ◽  
Life Insurance ◽  
Insurance Sector ◽  
Republic Of Macedonia ◽  
Insurance Penetration ◽  
The Republic ◽  
And Control ◽  
The Impact ◽  
Determinants Of Economic Growth ◽  
Insurance Development

The purpose of this paper is to examine the impact of insurance and economic growth, with empirical analysis for the Republic of Macedonia. We apply multiple regression and control for other relevant determinants of economic growth. The analysis used data for the period 1995 - 2010. In order to solve the model in the analysis will use the technique of least squares, followed by analysis of variability in order to identify the effects of each variable. Insurance development is measured by insurance penetration (insurance premiums in percentage of GDP). We used three different insurance variables - life insurance, non-life insurance and total insurance penetration. According to our findings, insurance sector development positively and significantly affects economic growth. The results are confirmed in terms of non-life insurance, and, total insurance, while the results show that life insurance negatively affect economic growth.

Insurance effect on economic growth – among economies in various phases of development

2017 ◽  
Vol 27 (4) ◽  
pp. 501-519 ◽  
Author(s):  
Sajid Mohy ul din ◽  
Angappan Regupathi ◽  
Arpah Abu-Bakar
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Life Insurance ◽  
Significant Relationship ◽  
Content Type ◽  
Long Run ◽  
The Usa ◽  
Emerging And Developing Countries ◽  
The Uk ◽  
The Relationship

Purpose The purpose of this paper is to explore the relationship between insurance and economic growth for six (developed, emerging and developing) countries over the period of 1980 to 2015. Design/methodology/approach The study applies panel auto-regressive distributed lagged (PMG/ARDL) method to examine long-term and short-term relationship between insurance and economic growth for the USA, the UK, China, India, Malaysia and Pakistan. Findings The authors concluded that there exists a positive and significant relationship between life insurance, non-life insurance, trade openness, stock-market development and economic growth in the long run as p-value is less than 5 per cent. This study also found a significant relationship between employment rate, banking development and economic growth for the long run but the direction is negative. Foreign direct investment shows an insignificant relationship with economic growth in the long run. The results highlighted a significant and positive relationship between non-life insurance and economic growth in the short-run for the USA, the UK, China, India, Malaysia and Pakistan. Moreover, the relationship between life insurance and economic growth is positive and significant for India, Pakistan and the UK. Results reveal a significant but a negative relationship between life insurance and economic growth for the USA, China and Malaysia. Research limitations/implications Analysis is performed for only six countries and results of these six might not represent the whole world. Practical implications This research would help policymaker to consider wider aspects of insurance rather than considering it complementary service industry. Social implications Every individual, today, spends a huge amount of funds to purchase insurance. He or she should be aware of the wider social impact of their spending apart from risk transferring. Originality/value Researchers recently shifted their focus to investigate the relationship between insurance and economic growth but the topic is still lacking sufficient literature and various knowledge gaps. The study is an attempt to contribute in terms of refinement of the already existing body of knowledge and to fill literature gap. In addition, apart from the insurance–economy relationship, very few empirical studies used financial, banking and stock market along with insurance, proxies to measure accurate insurance contribution. Another element of originality lies in the comparative analysis of developed, emerging and developing countries.

Global Restructuring, Knowledge and Learning

2004 ◽  
pp. 66-76
Author(s):  
E. Hershberg
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Political Institutions ◽  
Lower Cost ◽  
International Competitiveness ◽  
Value Chains ◽  
Global Competitiveness ◽  
Global Restructuring ◽  
Intensive Exploitation ◽  
High Road

The influence of globalization on international competitiveness is considered in the article. Two strategies of economic growth are pointed out: the low road, that is producing more at lower cost and lower wages, with increasingly intensive exploitation of labor and environment, and the high road, that is upgrading capabilities in order to produce better basing on knowledge. Restrictions for developing countries trying to reach global competitiveness are formulated. Special attention is paid to the concept of upgrading and opportunities of joining transnational value chains. The importance of learning and forming social and political institutions for successful upgrading of the economy is stressed.

Markets, Technological Change and Economic Growth (The Quaid-i-Azam Lecture)

1994 ◽  
Vol 33 (4I) ◽  
pp. 327-356 ◽  
Author(s):  
Richard G. Lipsey
Keyword(s):  
United States ◽  
Economic Growth ◽  
Developing Countries ◽  
Common Ground ◽  
The United States ◽  
Industrial Countries ◽  
Canadian Institute ◽  
Primary Focus ◽  
Short Time

I am honoured to be invited to give this lecture before so distinguished an audience of development economists. For the last 21/2 years I have been director of a project financed by the Canadian Institute for Advanced Research and composed of a group of scholars from Canada, the United States, and Israel.I Our brief is to study the determinants of long term economic growth. Although our primary focus is on advanced industrial countries such as my own, some of us have come to the conclusion that there is more common ground between developed and developing countries than we might have first thought. I am, however, no expert on development economics so I must let you decide how much of what I say is applicable to economies such as your own. Today, I will discuss some of the grand themes that have arisen in my studies with our group. In the short time available, I can only allude to how these themes are rooted in our more detailed studies. In doing this, I must hasten to add that I speak for myself alone; our group has no corporate view other than the sum of our individual, and very individualistic, views.

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