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Life Insurance Development and Economic Growth: Evidence from Developing Countries

Author

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  • Idrissa Ouedraogo

    (CEDRES - Université de Ouaga II)

  • Samuel Guérineau

    (CERDI - Centre d'Études et de Recherches sur le Développement International - UdA - Université d'Auvergne - Clermont-Ferrand I - CNRS - Centre National de la Recherche Scientifique)

  • Relwende Sawadogo

    (CERDI - Centre d'Études et de Recherches sur le Développement International - UdA - Université d'Auvergne - Clermont-Ferrand I - CNRS - Centre National de la Recherche Scientifique)

Abstract

This article examines the relation between the development of life insurance sector and economic growth, for a sample of 86 developing countries over the period 1996-2011. We also examine the heterogeneous effect of life insurance on growth. The econometric results show on the one hand that the development of life insurance has a positive effect on economic growth per capita and, on the other hand, that this effect varies according to the structural characteristics of countries. Thus, the marginal positive impact of the development of life insurance decreases with the levels of deposit interest rate, bank credit and stock market value traded, while the effect is greater in countries with high-quality institutions. Finally, life insurance effect on growth is less for SSA and British legal system countries, compared to non-SSA and non-British legal system countries.

Suggested Citation

  • Idrissa Ouedraogo & Samuel Guérineau & Relwende Sawadogo, 2016. "Life Insurance Development and Economic Growth: Evidence from Developing Countries," Working Papers halshs-01385002, HAL.
    • Handle: RePEc:hal:wpaper:halshs-01385002
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01385002
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    2. Sajid Mohy Ul Din & Arpah Abu-Bakar & Angappan Regupathi, 2017. "Does insurance promote economic growth: A comparative study of developed and emerging/developing economies," Cogent Economics & Finance, Taylor & Francis Journals, vol. 5(1), pages 1390029-139, January.
    3. Simplice Asongu & Joseph Nnanna & Paul Acha-Anyi, 2019. "Information technology, governance and insurance in Sub-Saharan Africa," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 16(8), pages 1253-1273, September.
    4. Gentiana Sharku, Evis Kumi, 2021. "Does insurance market impact the economic growth? Evidence from Albania," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 18(2), pages 267-289, December.
    5. Saon Ray, 2020. "India's Insurance Sector: Challenges and Opportunities," Indian Council for Research on International Economic Relations (ICRIER) Working Paper 394, Indian Council for Research on International Economic Relations (ICRIER), New Delhi, India.
    6. Cong Tam Trinh & Minh-Tri Ha & Nhut Quang Ho & Tho Alang, 2023. "National culture, public health spending and life insurance consumption: an international comparison," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-14, December.
    7. Kurukulasuriya Dinesh Udana Devindra Fernando & Thambawita Maddumage Nimali Tharanga & Narayanage Jayantha Dewasiri & Kiran Sood & Simon Grima & Eleftherios Thalassinos, 2023. "Insurance Penetration and Institutional Spillover on Economic Growth: A Dynamic Spatial Econometric Approach on the Asian and Europe Region," JRFM, MDPI, vol. 16(8), pages 1-21, August.
    8. Gentiana SHARKU & Etleva BAJRAMI, 2021. "Insurance-Economic Growth Nexus - Evidence From Selected Western Balkan'S Countries," Regional Science Inquiry, Hellenic Association of Regional Scientists, vol. 0(2), pages 53-68, June.
    9. Zekai Senol & Fatma Zeren & Mehmet Canakci, 2020. "The Relationship Between Insurance and Economic Growth," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 16(4), pages 145-155.

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    More about this item

    Keywords

    Life insurance market; Economic growth; Developing countries.;
    All these keywords.

    JEL classification:

    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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