Factors That Influence Firm Performance : A Dynamic Panel Data Analysis for Croatian Insurance Industry (CROSBI ID 200660)
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Podaci o odgovornosti
Pervan, Maja ; Pavić-Kramarić, Tomislava
engleski
Factors That Influence Firm Performance : A Dynamic Panel Data Analysis for Croatian Insurance Industry
Although banks profitability has received broad attention and has been extensively studied, there has not been a great deal of analysis in the academic literature on the influence of insurers’ characteristics, market and macro conditions on insurers’ financial success. Therefore, the main objective of this paper was to ascertain whether and which factors in particular are associated with life and composite insurers’ profitability. In order to achieve this objective we used dynamic panel data model and applied GMM estimator proposed by Arellano and Bond. The analysis was conducted for the 1999-2010 period and the results revealed that past performance has significant positive influence on current profitability. Additionally, all analyzed variables (i.e. market share, claims ratio, firm growth, concentration ratio, market growth and inflation) statistically significantly influence insurers’ performance. The exception was variable firm’s age that didn’t prove to be an important explanatory factor.
insurance industry ; dynamic panel data analysis
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