Efficiency, competition and the development of life insurance in France (1870-1939) Or: should we trust pension funds ?

Pierre Hautcoeur

DELTA Working Papers from DELTA (Ecole normale supérieure)

Abstract: French life insurance remained underdeveloped in comparison with other countries during a long period between 1870 and 1939. We show that technical peculiarities of the contracts used and their interaction with macroeconomic fluctuations explain the wide fluctuations we observe in insurance operations. In an industry where the accumulation both of long-lived contracts and reputation is central, it is likely that these fluctuations may have slowed the enlargement of the client population and the increase in managed assets ; nevertheless, we suggest they are not sufficient to explain their long term stagnation. Low returns paid to clients, resulting from very conservative investment strategies, were the main reason for that stagnation, since only those interested by the life-cycle related aspects of insurance contracts continued to put money in these institutions, with most savers investing directly in the market or through State-owned financial institutions. The main reason for such an investment (and then low-growth) strategy is the existence of a set of conservative regulations and a stable oligopoly in the industry from the 1880s onwards. We suggest that established insurance companies were able to impose regulations and barriers to entry blocking the access of competitors to their market, so maintaining a hold on a small but very profitable market.

Date: 2003
New Economics Papers: this item is included in nep-eec and nep-ias
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.delta.ens.fr/abstracts/wp200317.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Can't connect to www.delta.ens.fr:80 (No such host is known. )

Related works:
Journal Article: Efficiency, competition, and the development of life insurance in France (1870-1939): Or: should we trust pension funds? (2004)
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:del:abcdef:2003-17

Access Statistics for this paper

More papers in DELTA Working Papers from DELTA (Ecole normale supérieure) Contact information at EDIRC.
Bibliographic data for series maintained by ( this e-mail address is bad, please contact ).