Productivity of the Indian non-life insurance sector

Ashiq Mohd Ilyas and S. Rajasekaran

International Journal of Productivity and Performance Management, 2019, vol. 69, issue 4, 633-650

Abstract: Purpose - The purpose of this paper is to analyse the performance of the Indian non-life (general) insurance sector in terms of total factor productivity (TFP) over the period 2005–2016. Design/methodology/approach - This study utilises Färe‒Primont index (FPI) to access the change in TFP and its components: technical change, technical efficiency and mix and scale efficiency over the observation period. Moreover, it employs the Mann–WhitneyU-test to scrutinise the difference between the public and the private insurers in terms of growth in productivity. Findings - The results reveal that the insurance sector possesses a very low level of TFP. Also, the results divulge an improvement of 11.98 per cent in TFP of the insurance sector at an annual average rate of 12.41 per cent over the observation period. The growth in productivity is mainly attributable to the improvement of 10.81 per cent in the scale‒mix efficiency. The progress in scale‒mix efficiency is mainly the result of improvements in residual scale and residual mix efficiency. The results also show that the privately owned insurers have experienced a high productivity growth rate than the state-owned insurers. Practical implications - The results hold practical implications for the regulators, policymakers and decision makers of the Indian non-life insurance companies. Originality/value - This study is the first of its kind to use FPI, which satisfies all economically relevant axioms and tests defined by the index number theory to comprehensively access the change in TFP of the Indian non-life insurance sector.

Keywords: Efficiency; Productivity; Indian insurance sector; Färe‒Primont index (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:ijppmp:ijppm-04-2019-0147

DOI: 10.1108/IJPPM-04-2019-0147

Access Statistics for this article

International Journal of Productivity and Performance Management is currently edited by Dr Luisa Huatuco and Dr Nicky Shaw

More articles in International Journal of Productivity and Performance Management from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().