Study On Oligopoly Price Game Models Based On Property Insurance Market

With the rapid development of Chinese economy and the rising of people’s livingstandard, people’s understanding about insurance is becoming more and more deeper,their demand for insurance products is also increasingly enhancing, and our country’sinsurance market has great development potential. From the beginning of recovery ofbusiness in1979, Chinese insurance market has developed to a new competition ofoligopoly from the initial “a monopoly”. Study has shown that Chinese propertyinsurance market is a typical oligopoly market and the competition among oligarchs ismainly manifested as the price competition, the price competition is the process oflong-term game. Based on the studies of related literatures domestic and external, bymeans of game theory, nonlinear dynamics theory and dynamic economic theory, thedissertation carried out researches on the price game process of oligarchs andestablished a class of price game models. Simulations for the systems’ complexdynamic evolution processes are performed and the final conclusions will haveimportant practical significance and value. The main innovative points andachievements are summarized as follows.1. This dissertation applied nonlinear dynamic theory into the research onoligopoly price games in Chinese property insurance market and established theutility function of property insurance companies, based on the hypothesis of utilitymaximization and built the price game models of duopoly and three oligarchs. Itsimultaneously considered the actual cost structure of the property insurancecompanies and chose the more appropriate cost function when the models are built,this model is more quite close to the actual competition of property insuranceoligarchs comparing with the previous studies and therefore it has more practicalsignificance.2. On the basis of nonlinear dynamic models, this dissertation used some indexessuch as the price bifurcation diagram, Lyapunov exponent and the chaotic attractorsand so on to characterize the system’s chaotic properties, emphatically analyzed theinfluences which some important parameters’ changes in the model have on theoligarchs’ profit and utility. Comparing with the previous studies, this can take thecombination between nonlinear dynamic theory and economics theory one stage further.3. This dissertation built a duopoly price game model which one of the oligarchshas two-period delay, discussed the influence which the delayed structure has on themotion process of the system, emphatically studied the influence which the delayedstructure has on the change of the oligarchs’ competitive advantage, and put forwardthe reasonable introduced time of delay. This has further enriched the research ofdelay theory.4. Based on the hypothesis of service quality differentiation of propertyinsurance company and by means of product differentiation theory, this dissertationestablished the duopoly and oligopoly price game models and discussed the models’equilibrium solution. According to the analysis on the models, it deduced andsummarized the price competition strategies of Chinese property insurance companiesbased on the consideration of long-term development, which will provide thetheoretical support for the decision-making of all companies. It simultaneously put therelated theory researches into solving the actual problems at last.