Raising Capital in an Insurance Oligopoly Market
We consider an oligopoly market where firms offer insurance coverage against a risk characterised by aggregate uncertainty. Firms behave as if they were risk averse for a standard reason of costly external finance. The model consists in a two-stage game where firms choose their internal capital leve...
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| Veröffentlicht in: | The Geneva risk and insurance review 2012-03, Vol.37 (1), p.83-108 |
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| container_end_page | 108 |
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| container_title | The Geneva risk and insurance review |
| container_volume | 37 |
| creator | Hardelin, Julien de Forges, Sabine Lemoyne |
| description | We consider an oligopoly market where firms offer insurance coverage against a risk characterised by aggregate uncertainty. Firms behave as if they were risk averse for a standard reason of costly external finance. The model consists in a two-stage game where firms choose their internal capital level at stage one and compete on price at stage two. We characterise the subgame perfect Nash equilibria of this game and focus attention on the strategic impact of insurers capital choice. We discuss the model with regard to the insurance industry specificities and regulation. |
| doi_str_mv | 10.1057/grir.2011.4 |
| format | Article |
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| ispartof | The Geneva risk and insurance review, 2012-03, Vol.37 (1), p.83-108 |
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| subjects | Business models Capital costs Capital markets Competition Costs Economics and Finance Finance Financial risk Financial Services Game theory Insurance Insurance companies Insurance coverage Insurance industry Insurance markets Insurance providers International Management decisions Market prices Nash equilibrium Oligopolies Opportunity costs Prices Profits Reinsurance Risk aversion Risk Management Risk premiums Solvency Stockholders |
| title | Raising Capital in an Insurance Oligopoly Market |
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