Unité mixte de recherche 7235

Interactions Between Risk-Taking, Capital, and Reinsurance for Property-Liability Insurance Firms

Selim Mankai, Aymen Belgacem

[en]Theory and empirical evidence suggest short-run interactions between capital and risk. This paper analyzes the effects of reinsurance, as a new endogenous decision variable, on this policy mix. We examine this issue using a system of simultaneous equations applied to the U.S. property-liability insurance industry. The results identify significant interactions between capital, risk and reinsurance. The relationship between risk and capital is positive, indicating the effectiveness of regulatory mechanisms. Reinsurance is negatively associated with capital, for which it appears to act as a substitute. These results are sensitive to the level of capital held in excess of the regulatory minimum requirements. Weakly capitalized firms adjust their reinsurance and risk levels more quickly and try to rebuild an appropriate capital buffer. Unlike other decision variables, the capital ratio converges toward a long-run target level.[/en]


jeudi 8 juin 2023


Sahil Chopra (Université Sorbonne Paris-Nord)

Economics of litigation : Securities class action with third-party funding

lundi 12 juin 2023

Law, Institutions and Economics in Nanterre (LIEN)

Arthur Silve (IAST / Univ. Laval)


jeudi 15 juin 2023


Guillaume Pierné


lundi 19 juin 2023

Law, Institutions and Economics in Nanterre (LIEN)

Juan Mora-Sanguinetti (Banco de Espana)


mardi 20 juin 2023

Colloques et Workshops

Webinar TELE –Theoretical European Law & Economics

jeudi 22 juin 2023


Jules Chaperon


vendredi 1 septembre 2023

Professeurs invités

Ken Yahagi

lundi 18 septembre 2023

Colloques et Workshops

L’économie de la régulation entre intérêt public et intérêts privés : capture, conflits d’intérêts et revolving doors

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