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WP-05/23: An Empirical Cross-Country Assessment of the Nexuses Between Insurance, Economic Growth, Human Development, and Institutional Quality

Alfredo Baronio, Flavio Buchieri, Gustavo Ferro and Ana Vianco

ABSTRACT

We contribute to the empirical literature exploring jointly the three nexuses between insurance development with economic growth, institutional, and human development, which in the past were analyzed separately. We built one database for 59 countries and selected evidence from 254 variables using principal component analysis. We hypothesize that “better institutions bring more opportunities for the development of the insurance sector through its impulse to economic growth and human development, which in turn generate an insurance demand increase to protect the enhanced amount and value of human and physical capital.” We estimate a cross-country recursive econometric model to corroborate the hypothesis.

Keywords: Insurance, Growth, Institutions, Human Development