| With the operation of the market economic system, China’s economic developed by leaps and bounds, and quickly developed insurance industry also have sprung up and restore domestic insurance business since1980. After30years of development, the premium income alone increased from450million RMB in1980to1.43trillion RMB in2011, the insurance company also increased from original insurer Ito152(by the end of2011). While rejoicing at the arrogant success, we must also face the problems exposed in the rapid development and have to think about finding a healthy path of sustainable development. Based on the theory of industry economics related theory, through empirical research on the relationship of China’s insurance industry structure and market performance, this paper aims to explore the inherent law of development of insurance industry in China and to find the model of the development of China’s insurance industry which might be more reasonable, standardized and scientific.Based on the two main theories about industry economics----"Harvard Traditions" and "Chicago traditions" for clues, through empirical research, this paper aims to validate which theory match the development of our domestic life insurance and non-life insurance industry. And finally we can apply the theories to explain the problems existing in the insurance market and to propose the solution. What’s more, the theories will become a useful and important guide for the future development of China’s insurance industry.As the main point of the traditional "Harvard Traditions ", the market structure decides market behavior among the subjects, and then decides market performance. According to the theory----"Harvard Traditions ", higher market share and higher market concentration will make the monopoly collusion between large enterprises who will achieve monopoly profit. As a result, there will be economic efficiency and social welfare loss. As the main point of the traditional "Chicago Traditions", higher industry concentration ratio is the result of market competition. The person hold this view believes that the market free competition makes enterprises get high efficiency, reduces the production cost. Then the enterprises get more profits, increase their ability to grow, and win a larger share of the market, and finally lead to the improvement of industrial concentration.If the empirical results show that "Harvard Traditions" is established in our domestic insurance market, it suggests that high industrial concentration has nothing to do with operational efficiency and the incumbent firms achieve monopoly profits, and both of the market economic efficiency and social welfare are damaged. Then the regulators will need to control high concentration, increase the degree of competition in the market, such as more strict examination and approval of the insurance enterprises mergers and acquisitions, to limit the scale of insurance company and to control the increase of industrial concentration scale expansion; And if "Chicago" traditional insurance market was set up in our country, it shows that high market concentration is caused by high efficiency of partial enterprise, which is the result of market competition. Then the regulators can focus on whether companies share resulting benefits to consumers, without controlling high concentration of the market. It also provides support for merger, acquisition and reorganization of the insurance industry with theoretical support.This article altogether is divided into four parts:the first chapter is the introduction part, this part expounds the background of problem and the research significance and the domestic and foreign existing literature review, illustrates the overall framework and research method of the thesis, finally points out the main innovation points and deficiencies, aims to lay a certain theoretical basis for study of the article.The second chapter will introduce our country’s insurance industry development and analysis present situation of insurance industrial structure. First of all, it reviews the development of insurance industry in China, on this basis, to further studies are combined with the characteristics of development in China. Then this chapter introduces several kinds of partition method based on the industrial structure; what’s more, the author analyzes the structure of domestic life and non-life insurance industry, and the results shows that either life insurance or non-life insurance market is still in the stage of oligopoly while industrial concentration declined year by year. This part mainly to our domestic insurance industry structure situation to carry on the qualitative analysis aims to combine with the empirical part, common comprehensively reveal the development of our domestic life insurance industry structure features.In this paper, the third part carries on the regression analysis of the correlation between the insurance industry structure and market performance, separately about life insurance market and non-life insurance market in China. Before the regression analysis, this chapter illustrates the choices and ideas of the empirical method, the definition of the research variables and selection criteria. The selection process has carried on the detailed instructions. The total return on assets (ROA) is mainly selected as a measure of performance; more important, the insurance price is also selected as a measure of performance from the perspective of the applicant (consumers), to examine the insurance company’s contribution to the market and price benefits provided by the applicant. Compared the several index of measuring the industrial structure, this paper finally chooses to measure industrial concentration of HHI index measures of industrial structure as the variables. And. in consideration that the company’s market share and comprehensive operation efficiency may be the impact on corporate performance, and the need for testing traditional "Chicago" in the domestic insurance market, therefore, in this paper, the market share and comprehensive operation efficiency (which can, be further decomposed into pure technical efficiency and scale efficiency) is introduced into the model. Finally through the empirical analysis of regression model, it aims to explain the relationship between the variables.In the fourth chapter which is following the empirical analysis of the third chapter, the results of the empirical conclusion is given and combined with qualitative analysis and related theories and practical experience, and some relevant policy suggestions for the future development of China’s insurance industry will be put forward finally.This article’s main innovation lies in the studying on the relationship between industry structure and market performance of life insurance market and non-life insurance market separately, and quoting insurance price as a measure variable of market performance indicators from the perspective of the applicant (the consumer) to measure the company’s contribution to the market. What is more, this article chooses the latest industry data and studies the domestic life insurance new developments in recent years. But the deficiency of this paper exists as well, fist of all, the limits of theoretical basis. Because the empirical results show that China’s specific condition about domestic life and non-life insurance market is not fully comply with the two kinds of theories which are mentioned in this article, but is a fusion of the two theories, as a result, we does not find a exactly theory to guide the development of China’s insurance industry as expected. Secondly, the different selection of empirical models may produce different effect, this paper is not comprehensive. All of this should be improved in the further research. |
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