nep-ias New Economics Papers
on Insurance Economics
Issue of 2021‒12‒06
ten papers chosen by
Soumitra K. Mallick
Indian Institute of Social Welfare and Business Management

  1. Crop Insurance and Rice Productivity: Evidence from Eastern India By Saroj, Sunil; Kumar, Anjani; Mishra, Ashok
  2. Does Index-Based Livestock Insurance Change the Cash Saving Behaviour of Pastoralists in Southern Ethiopia By Gebrekidan, Tnsue
  3. Effect of Index-Based Livestock Insurance on Uninsured Poultry Production: Experimental Evidence from Southern Ethiopia By Gebrekidan, Tnsue
  4. Basis Risk and Farmers’ Participation in the U.S. Federal Crop Insurance Program: A Conceptual Framework and its Application By Lu, Pin; Hennessy, David A.; Feng, Hongli
  5. Market equilibrium with management costs and implications for insurance accounting By Olivier Gossner; Michael Florig
  6. The Impact of Financial Inclusion on Household Health Expenditures in Africa By Ofeh M. Edoh; Tii N. Nchofoung; Ofeh E. Anchi
  7. Equity--Linked Life Insurances on Maximum of Several Assets By Battulga Gankhuu
  8. Global Financial Crisis, Export Credit Insurance, and Scope Adjustment of Multiproduct Exporting Firms By Hea-Jung Hyun; Jung Hur
  9. Philippines: Financial Soundness Indicators By International Monetary Fund
  10. Are Climate Change Policies Politically Costly? By Davide Furceri; Michael Ganslmeier; Mr. Jonathan David Ostry

  1. By: Saroj, Sunil; Kumar, Anjani; Mishra, Ashok
    Keywords: Risk and Uncertainty, Crop Production/Industries
    Date: 2021–08
  2. By: Gebrekidan, Tnsue
    Keywords: Livestock Production/Industries, Risk and Uncertainty
    Date: 2021–08
  3. By: Gebrekidan, Tnsue
    Keywords: Livestock Production/Industries, Risk and Uncertainty
    Date: 2021–08
  4. By: Lu, Pin; Hennessy, David A.; Feng, Hongli
    Keywords: Farm Management, Risk and Uncertainty
    Date: 2021
  5. By: Olivier Gossner (CNRS-CREST, Ecole Polytechnique and London School of Economics); Michael Florig (Economics Department, Ecole Polytechnique)
    Abstract: We study a general equilibrium model with uncertainty where agents incur costs for managing a risky assets. The equilibrium price, as characterized via a (risk neutral) probability measure on the state space is employed for valuation in several regulatory accounting regimes such as Solvency II for the European Economic Area, SST for Switzerland, BSCR for Bermuda and going forward under IFRS17. We find that the valuation approach used in practice under these accounting regimes is missing a correction term by ignoring that not only the insurance business to be valued is incurring investment management costs, but also other insurers, and more generally market participants as well are incurring such costs. For insurers subject to Solvency II regulation, we estimate the value of the correction term to be of the order of € 150 billion or 2% of insurer's investments.
    Date: 2021–11–14
  6. By: Ofeh M. Edoh (University of Dschang, Cameroon); Tii N. Nchofoung (University of Dschang, Cameroon); Ofeh E. Anchi (University of Bamenda, Cameroon)
    Abstract: This study examines the impact of financial inclusion on household health expenditure in 17 African countries. It argues that financial inclusion is an active influencer of individuals’ health demand and that Gross Domestic Product (GDP) per capita and voluntary health insurance schemes tend to be active transmission channels through which financial inclusion affects household health expenditures. The study used an instrumental variable (2SLS) technique for the analysis over a period from 2008 to 2017.Results from the study show that being financially included leads to increase household health expenditures. Suggestions for policy emerging from this study to governments in Africa are on the aspect of fostering financial inclusion to a wider population alongside enhancing the Universal Health Coverage (UHC) plan to ease the burden of out-of-pocket payments on households.
    Keywords: Financial inclusion, Health expenditure, Out-of-pocket (OOP) payments, 2SLS
    JEL: G15 I13 C23
    Date: 2021–01
  7. By: Battulga Gankhuu
    Abstract: This paper presents pricing and hedging methods for segregated funds and unit-linked life insurance products that are based on a Bayesian Markov--Switching Vector Autoregressive (MS--VAR) process. Here we assumed that a regime-switching process is generated by a homogeneous Markov process. An advantage of our model is it depends on economic variables and is not complicated.
    Date: 2021–11
  8. By: Hea-Jung Hyun (College of International Studies, Kyung Hee University, Korea); Jung Hur (Department of Economics, Sogang University, Korea)
    Abstract: We examine the role of export credit insurance (ECI) in Korea during two periods of financial crisis by focusing on insured exporting firms' response on the scope of exported products and destination countries. Using unique Korean firm-level data over 1995–2010, our empirical analyses show that during financial crises (e.g., the 1998 Asian financial crisis and the 2008 global financial crisis), multiproduct firms reduced the scope of their export products and the number of destination countries. However, firms with above-median levels of ECI reduced the scope of product and country significantly less than firms with below-median ECI. Core products were less likely to be dropped during the two crisis periods. After the 2008 global financial crisis, countries with high political risk and a low level of financial development were less likely to be dropped from the export market portfolios of firms with high ECI. These findings may imply that larger ECI may be related to higher risk-taking behavior of exporters under asymmetric information.
    Keywords: Product Scope, Country Diversification, Export Credit Insurance, Global Financial Crisis
    JEL: F13 F34 D22
    Date: 2021
  9. By: International Monetary Fund
    Abstract: With the support of the IMF’s Asia and Pacific Department (APD) and the Bangko Sentral ng Pilipinas (BSP), an IMF Statistics Department (STA)’s remote financial soundness indicators (FSIs) technical assistance (TA) mission took place during April 30–May 14, 2021. The main objective of the mission was to assist the BSP in compiling FSI for the other financial corporations (OFCs) sector, in line with the 2019 Financial Soundness Indicators Compilation Guide (Guide). Specifically, the Guide recommends compiling indicators for money market funds, insurance corporations, and pension funds, as well as for the total OFC sector. The work of the mission was facilitated by the excellent collaboration of BSP’s staff, in particular of the Department of Economic Statistics (DES). The list of officials met during the mission can be found in Appendix I.
    Date: 2021–11–17
  10. By: Davide Furceri; Michael Ganslmeier; Mr. Jonathan David Ostry
    Abstract: Are policies designed to avert climate change (Climate Change Policies, or CCPs) politically costly? Using data on governmental popular support and the OECD’s Environmental Stringency Index, we find that CCPs are not necessarily politically costly: policy design matters. First, only market-based CCPs (such as emission taxes) generate negative effects on popular support. Second, the effects are muted in countries where non-green (dirty) energy is a relatively small input into production. Third, political costs are not significant when CCPs are implemented during periods of low oil prices, generous social insurance and low inequality.
    Keywords: EPS change; policy design; Policy implication; popular support; baseline model; Climate change; Climate policy; Fuel prices; Environmental policy; Natural disasters; Global
    Date: 2021–06–04

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