WTO and the Chinese Insurance Industry
Geneva Papers on Risk and Insurance - Issues and Practice, Vol. 34, No. 3, pp. 440-465, 2009
30 Pages Posted: 29 Sep 2007 Last revised: 2 Oct 2013
Date Written: April 7, 2008
This paper provides new information on the impact of the entry of foreign firms on a financial services industry by examining the Chinese insurance industry surrounding China's accession to the World Trade Organization (WTO). Our analysis reveals that insurers experienced significant growth in total factor productivity over the sample period. We also observe a structural improvement in efficiency after WTO accession, but geographic and product market restrictions placed on foreign firms reduce these positive effects. Overall, the results are consistent with there being a significant increase in social welfare during our sample period, but they also lend support for further deregulation.
Keywords: Insurance, Efficiency, Productivity, WTO
JEL Classification: G22, G18, D24, L10
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