The Open Cybernetics & Systemics Journal

2015, 9 : 1530-1534
Published online 2015 September 30. DOI: 10.2174/1874110X01509011530
Publisher ID: TOCSJ-9-1530

Analysis of the Relationship Between Industry Concentration and GDP Growth: China’s Property Insurance Industry

Qianqian Li
School of Economics, Xiamen University, Siming South Road 422, 361005, Xiamen, China.

ABSTRACT

This paper examines the impact of the concentration of the property insurance industry on economic growth in China. We first compute the Herfindahl-Hirschman Index (HHI) for the Chinese property insurance industry and establish a two-step system of generalized methods of moments (Two-Step SYS-GMM) estimation to compute the economic effect using a unique data set from the years 1980 to 2014. The results show that while industry concentration appears to have decelerated in recent years, the property insurance market in China is still a comparatively oligopolistic market. Moreover, the HHI has a significantly negative impact on gross domestic product, and lowering the HHI could lead to higher economic growth.

Keywords:

GDP growth, GMM, HHI, industry, property insurance.