INSURANCE-ECONOMIC GROWTH NEXUS - EVIDENCE FROM SELECTED WESTERN BALKAN'S COUNTRIES

Gentiana Sharku () and Etleva Bajrami ()
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Gentiana Sharku: Prof. Assoc. Dr. Pedagogue in Finance Department, Faculty of Economy, University of Tirana
Etleva Bajrami: Prof. Assoc. Dr. Pedagogue in Finance Department, Faculty of Economy, University of Tirana

Regional Science Inquiry, 2021, vol. XIII, issue 2, 53-68

Abstract: The insurance-growth nexus has attracted the attention of many academics and researchers, due to the huge potential the insurance industry constitutes for the economic development of developed and developing countries as well. The purpose of this paper is to investigate the impact the insurance industry has on economic growth of emerging countries, such as the Western Balkan’s countries. The impact is studied through two indicators of insurance industry: density and penetration, and for the total, life and non-life insurance market. The authors have applied a multiple regression analysis using annual data on insurance industry and GDP per capita from 2004 to 2019. This paper has contributed in the existing literature by exploring (i) whether insurance market has a positive or negative effect on economic growth of developing countries; (ii) which of the insurance indicators explains better the impact – insurance penetration or density indicator; and (iii) which of insurance activities has the largest effect on economic development: total, life or non-life insurance. The conclusions of this paper will serve to the public and private operators to evaluate the significance that each segment of insurance industry has on the economic development and to undertake the proper policies.

Keywords: Insurance penetration; insurance density; GDP per capita (search for similar items in EconPapers)
JEL-codes: C23 G22 O52 (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:hrs:journl:v:xiii:y:2021:i:2:p:53-68

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