Abstract
The unbalanced economic development results in the difference in operating efficiency of the non-life insurance industry in China’s provinces; based on the DEA-Malmquist index method, this paper investigates the provincial differences, dynamic change characteristics, and causes of non-life insurance productivity in 31 provinces of China from 2004 to 2017. The results show that in the sample period, there are significant differences between provinces and regions in China’s non-life insurance efficiency, which generally shows the echelon spatial characteristics of “strong in the west and weak in the east”. Technological progress in the western region promotes the rapid growth of total factor productivity, while the low efficiency of technological progress in the eastern region restrains the improvement of total factor productivity. The overall total factor productivity of China’s provincial non-life insurance industry is on the rise, mainly due to the improvement of pure technical efficiency and scale efficiency, while technological progress has an inhibiting effect on the contrary. These conclusions are of reference value for relevant stakeholders in China’s provincial non-life insurance market to formulate development strategies and business strategies.
Highlights
With the rapid development of China’s economy, the deepening of financial reform and opening up in recent years has brought substantial changes to the insurance market.e development of the non-life insurance market is rapid
Tfpch can be further decomposed into the technical efficiency change index (Effch) and technical progress index (Tech) as follows: Input index
The Sech and pure technical efficiency index (Pech) increased by 0.1% and 0.3% on average, respectively. is fully shows that the overall management and technical level of the provincial non-life insurance market play a major role in improving the overall efficiency, while the driving effect of technological progress presents a negative effect
Summary
With the rapid development of China’s economy, the deepening of financial reform and opening up in recent years has brought substantial changes to the insurance market. Erefore, this paper attempts to use the DEA-Malmquist index method [19,20,21,22,23] to analyze the spatial differentiation characteristics, dynamic trends, and determinants of the efficiency of total factor productivity of non-life insurance market in 31 provinces of China during 2004–2017. Erefore, our paper expands the insurance literature of efficiency comparison by comparing the total factor productivity and segmentation efficiency of the developing nonlife insurance markets in China. The provincial comparison provides the regional distribution characteristics of relative efficiency and shows the dynamic trend of non-life insurance market efficiency, which increases our understanding of the reasons for the efficiency differences of the provincial non-life insurance market.
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