Recent Competition in the Japanese Life Insurance Industry

37 Pages Posted: 20 Jun 2005

See all articles by Toshiyuki Souma

Toshiyuki Souma

Kyoto Gakuen University

Yoshiro Tsutsui

Kyoto Bunkyo University

Abstract

This paper examines a change in the level of competition in the Japanese life insurance industry over the last 17 years. We estimate the first order condition for profit-maximizing insurance oligopolies to obtain the degree of non-competition and collusion. Estimation results suggest that: 1) not only stock companies, but also mutual companies maximize their own profits rather than pay out dividends to policyholders; 2) competition has become stronger since 1995; 3) revision of Insurance Industry Law and failures of insurance companies promoted the competition; and 4) the competition in the recent years is still more lax than the pre-war period.

Keywords: Life insurance, Degree of competition, Collusion, Japan

JEL Classification: G22, L13, L21

Suggested Citation

Souma, Toshiyuki and Tsutsui, Yoshiro, Recent Competition in the Japanese Life Insurance Industry. Available at SSRN: https://ssrn.com/abstract=744244 or http://dx.doi.org/10.2139/ssrn.744244

Toshiyuki Souma

Kyoto Gakuen University ( email )

Kyoto, 621-8555
Japan

Yoshiro Tsutsui (Contact Author)

Kyoto Bunkyo University ( email )

Senzoku-80 Makishimacho
Uji, Kyoto 611-0041
Japan

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