Traditionally, underwriting performance is considered to be a function of industry specific institutions. Using quarterly data from 1974 to 1990, we provide evidence of a long run linkage between the general economy and the underwriting performance as measured by the combined ratio. Using cointegration techniques we estimate the long run relationship between the general economy as measured by real gross domestic product, the short-term interest rate, and inflation. We then estimate the short-run linkage between the industry and the general economy using vector autoregression techniques and find that, although the property-liability industry is linked to the long run performance of the national economy, short run shocks in economic variables have little effect on the combined ratio.
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Paper provided by Risk and Insurance Archive in its series Working Papers with number
020.
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Claudia Goldin & Robert A. Margo, 1992.
"Wages, Prices, and Labor Markets before the Civil War,"
NBER Chapters,
in: Strategic Factors in Nineteenth Century American Economic History: A Volume to Honor Robert W. Fogel, pages 67-104
National Bureau of Economic Research, Inc.
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