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Conduct Effects of Gradual Entry Liberalization in Insurance

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  • Barros, Pedro Pita

Abstract

The effects of rate regulation on insurance have been profusely investigated in the empirical literature but less is known about the effects of entry liberalization. We investigate the effects of an entry liberalization process on conduct of insurance firms under a rate regulation system. An explicit model of oligopolistic interaction is proposed and an application to the Portuguese auto-insurance market is reported. The results show that coordination between insurance firms was only temporarily upset by a gradual liberalization on entry conditions, with firms resuming almost immediately a coordinated equilibrium. Copyright 1995 by Kluwer Academic Publishers

Suggested Citation

  • Barros, Pedro Pita, 1995. "Conduct Effects of Gradual Entry Liberalization in Insurance," Journal of Regulatory Economics, Springer, vol. 8(1), pages 45-60, July.
  • Handle: RePEc:kap:regeco:v:8:y:1995:i:1:p:45-60
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    Cited by:

    1. Eling, Martin & Gatzert, Nadine & Schmeiser, Hato, 2009. "Minimum standards for investment performance: A new perspective on non-life insurer solvency," Insurance: Mathematics and Economics, Elsevier, vol. 45(1), pages 113-122, August.
    2. Bernard Hoekman & Aaditya Mattoo, 2000. "Services, economic development and the next round of negotiations on services," Journal of International Development, John Wiley & Sons, Ltd., vol. 12(2), pages 283-296.

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