Informal Insurance Institution Study

Informal Insurance Institution StudyIn studying early rural communes, western anthropologists originallydiscovered that there existed some primary forms of a risk-sharing systeminherent within the colonial communities and members. Informalrisk-sharing system was paid attention in the middle of the last centurywhen economists researched the economic development of the thirdworld economy, leading to the emergence of relevant analytical models.The literature suggested that when there was a shortage of formalcommercial insurance and social security institutions informalrisk-sharing could function adequately in the earliest agricultural societyand effectively achieve risk-sharing objectives.Building on the prior research overseas, this research focuses on theinstitutional risk management arrangements in China's traditional andpresent rural villages. The significance of this research includes: firstly,there is a need to explore the risk protection systems for the ruralcommunes given that China has long been a typical agriculture societyand the agriculture is largely subject to innumerable natural disasters;secondly, there are little formal mechanisms of risk protections andmanagement available to the rural communes and thus other systemsneeds to be explored; thirdly, the research is needed to argue that theinformal insurance system could play very important role in the wholesystem of social security within the countryside of China.The objectives of this thesis includes: (1)To study the different type of risk management institution and systems and their origination, development, character and termination. (2)To define the informal insurance institution and its characteristics from the perspective of mechanism of the mutual assistance and damage indemnity other than commercial and social insurance, and to illustrate its function and operations with some real examples in our rural community. (3)To analyze the influence of informal insurance upon the formal institution, and discuss the possibility of alteration and utilization of the institutional arrangement to promote and rebuilt out a social security system in China especially in rural area.Although the informal insurance system was rarely studied in China, theissue in a broad sense has recently received increasing interests. Someessays provide very fresh idea and valuable thinking. The foreigners'researches have largely focused on the performance measurement of theinformal institutions rather than the nature of the system, illustrating thatthe informal system has been well existed in many less-developedcountries in the west. With various research methods, data and samples,the results of those researches would be difficult to be applied in the caseof China; this has thus encouraged to devotion my time to the study ofthis unique subject.This research has adopted institutional approaches combined withresearch methods in economics, sociology, history and anthropology andunderpinned by a variety of references in these areas. The research haspaid a special attention to the view of localization with a view toemploying our own culture to examine the informal institutional issues inChina. Despite insurance and its research method and theory was initiallyimported from the west, there is likely to occur problems in the context oflocalization given the fact there are differences in culture, language andhuman and social behavior between the importer and exporter. In addition,there will not be only one determined culture model cross the world, sodoes the insurance institution arrangement.In this thesis the risk sharing system is overall considered an inner cultureinstitution which can not be totally copied and colonized. It is conjecturedthat different cultures and societies would lead to various informal riskmanagement systems, and no universal system applied across the world.In this thesis, the localization has also been treated cautiously againstbasic logic, rational and theoretical framework. The research has tried toavoid bias caused by any attempt to overstate the...