Diversification Versus Strategic Focus: Evidence from Insurance Intermediaries in Taiwan

Amihud, Y. and Lev, B. (1981) ‘Risk reduction as a managerial motive for conglomerate mergers’, The Bell Journal of Economics 12(2): 605–617. Barrese, J. and Nelson, J.M. (1992) ‘Independent and exclusive agency insurers: A reexamination of the cost differential’, The Journal of Risk and Insurance 59(3): 375–397. Belsley, D.A., Kuh, E. and Welsch, R.E. (1980) Regression Diagnostics, Identifying Influential Data and Sources of Collinearity, New York: Wiley. Berger, A.N. and Bonaccorsi di Patti, E. (2006) ‘A new approach to testing agency theory and an application to the banking industry’, Journal of Banking and Finance 30(4): 1065–1102. Berger, A.N. and Humphrey, D.B. (1997) ‘Efficiency of financial institutions: International survey and directions for future research’, European Journal of Operational Research 98(2): 175–213. Berger, A.N., Cummins, J.D. and Weiss, M.A. (1997) ‘The coexistence of multiple distribution systems for financial services: The Case of PL Insurance’, The Journal of Business 70(4): 515–546. Berger, A.N., Cummins, J.D., Weiss, M.A. and Zi, H. (2000) ‘conglomeration versus strategic focus: Evidence from the insurance industry’, Journal of Financial Intermediation 9(4): 323–362. Berger, P.G. and Ofek, E. (1995) ‘Diversification’s effect on firm value’, Journal of Financial Economics 37(1): 39–65. Berry-Stölzle, T.R., Liebenberg, A.P., Ruhland, J.S. and Sommer, D. W. (2012) ‘Determinants of corporate diversification: Evidence from the property–liability insurance industry,’ The Journal of Risk and Insurance 79(2): 381–413. Berry-Stölzle, T.R., Hoyt, R.E. and Wende, S. (2013) ‘Capital market development, competition, property rights, and the value of insurer product-line diversification: A cross-country analysis,’ The Journal of Risk and Insurance 80(2): 423–459. Biener, C., Eling, M. and Wirfs, J.H. (2016) ‘The determinants of efficiency and productivity in the Swiss insurance industry, European Journal of Operational Research 248(2): 703–714. Brozen, Y. (1982) ‘Concentration, Mergers, and Public Policy, New York: MacMillan Press. Campa, J.M., Kedia, S. (2002) ‘Explaining the Diversification Discount’, Journal of Finance 57(4): 1731–1762. Chen, L.R., Lai, G.C. and Wang, J.L. (2011) ‘Conversion and efficiency performance changes: Evidence from the U.S. property-liability insurance industry’, The Geneva Risk and Insurance Review 36(1): 1–35. Choi, P. B. and Weiss, M. A. (2005) ‘An empirical investigation of market structure, efficiency and performance in property-liability insurance’, The Journal of Risk and Insurance 72(4): 635–673. Colquitt, L.L. and Hoyt, R.E. (1997) ‘Determinants of corporate hedging behavior: Evidence from the life insurance industry’, The Journal of Risk and Insurance 64(4): 649–671. Comment, R. and Jarrell, G.A. (1995) ‘Corporate focus and stock returns’, Journal of Financial Economics 37(1): 67–87. Cummins, J. D., Tennyson, S. and Weiss, M.A. (1999) ‘Consolidation and efficiency in the U.S. life insurance industry’, Journal of Banking & Finance 23(2–4): 325–357. Cummins, J.D. and Doherty, N.A. (2006) ‘The economics of insurance intermediaries’, The Journal of Risk and Insurance 73(3): 359–396. Cummins, J.D. and Nini, G. (2002) ‘Optimal capital utilization by financial firms: Evidence from the PL insurance industry’, Journal of Financial Services Research 21(1): 15–23. Cummins, J.D. and VanDerhei, J.L. (1979) ‘A note on the relative efficiency of PL insurance distribution systems’, The Bell Journal of Economics 10(2): 709–719. Cummins, J.D. and Weiss, M.A. (2000) ‘Analyzing firm performance in the insurance industry using frontier efficiency methods’, in G. Dionne (ed.) Handbook of Insurance Economics, Boston, MA: Kluwer. Cummins, J.D. and Weiss, M.A. (2013) ‘Analyzing firm performance in the insurance industry using frontier efficiency methods’,. in G. Dionne (ed.) Handbook of Insurance Economics, Boston, MA: Kluwer. Cummins, J.D. and Zi, H. (1998) ‘Comparison of frontier efficiency methods: An application to the US life insurance industry’, Journal of Productivity Analysis 10(2): 131–152. Cummins, J.D. (1977) ‘Economies of scale in independent insurance agencies’, The Journal of Risk and Insurance 44(4): 539–553. Cummins, J.D., Weiss, M.A., Xie, X. and Zi, H. (2010) ‘Economies of scope in financial services: A dea efficiency analysis of the US insurance industry’, Journal of Banking & Finance 34(7): 1525–1539. Cummins, J.D. and Xie, X. (2013) ‘Efficiency, productivity, and scale economies in the U.S. property-liability insurance industry’, Journal of Productivity Analysis 39(2): 141–164. Cummins, J.D., Klumpes, P. and Weiss, M.A. (2015) ‘Mergers and acquisitions in the global insurance industry: Valuation effects,’ The Geneva Papers on Risk and Insurance – Issues and Practice 40(3): 444–473. Demsetz, H. (1973) ‘Industry structure, market rivalry, and public policy’, The Journal of Law & Economics, 16(1): 1–9. Demsetz, H. (1974) ‘Two Systems of Belief About Monopoly, in H.J. Goldschmid, H.M. Mann and J.F. Weston (eds) Industrial Concentration: The New Learning, Boston: Little, Brown, pp. 164–184. Eckardt, M. and Räthke-Döppner, S. (2010) ‘The quality of insurance intermediary services – Empirical evidence for Germany’, The Journal of Risk and Insurance 77(3): 667–701. Elango, B., Ma, Y.L. and Pope, N. (2008) ‘An Investigation into the diversification–performance relationship in the U.S. property–liability insurance industry’, The Journal of Risk and Insurance 75(3): 567–591. Eling, M. and Luhnen, M. (2010) ‘Frontier efficiency methodologies to measure performance in the insurance industry: Overview, systematization, and recent developments’, The Geneva Papers on Risk and Insurance – Issues and Practice 35(2): 217–265. Färe, R., Grosskopf, S. and Lovell, C.A.K. (1985) The Measurement of Efficiency of Production, Boston: Kluwer-Nijhoff. Färe, R., Grosskopf, S. Norris, M. and Zhang, Z. (1994) ‘Productivity growth, technical progress, and efficiency change in industrialized countries’, The American Economic Review 84(1): 66–83. Farrell, M.J. (1957) ‘The measurement of productive efficiency’, Journal of the Royal Statistical Society 120(3): 253–281. Fields, J. and Murphy, N. (1989) ‘An analysis of efficiency in the delivery of financial services: The case of life agencies’, Journal of Financial Services Research 2(4): 343–356. Gardner, L. and Grace, M. (1993) ‘X-efficiency in the U.S. life insurance industry’, Journal of Banking & Finance 17(2–3): 497–510. Grace, M.F. and Timme, S.G. (1992) ‘An examination of cost economies in the United States life insurance industry’, The Journal of Risk and Insurance 59(1): 72–103. Hirao, Y. and Inoue, T. (2004) ‘On the cost structure of the Japanese property-casualty insurance industry’, The Journal of Risk and Insurance 71(3): 501–530. Hogan, A.M.B., Satish, P.K. and Witt, R.C. (1995) ‘The cost structure of distribution systems in the U.S. property/liability insurance market’, The Geneva Papers on Risk and Insurance – Issues and Practice 20(2): 230–245. Hoyt, R.E. and Trieschmann, J.S. (1991) ‘Risk/return relationships for life-health, property-liability, and diversified insurers,’ The Journal of Risk and Insurance 58(2): 322–330. Hsieh, S.H., Liu, C.T., Tzeng, L.Y. (2014) ‘Insurance marketing channel as a screening mechanism: Empirical evidences from Taiwan automobile insurance market’, The Geneva Papers on Risk and Insurance – Issues and Practice 39(1): 90–103. Jeng, V. and Lai, G.C. (2005) ‘Ownership structure, agency costs, specialization and efficiency: The analysis of keiretsu and independent insurers in the Japanese non-life insurance industry’, The Journal of Risk and Insurance 72(1): 105–158. Jeng, V., Lai, G.C. and McNamara, M.J. (2007) ‘Efficiency and demutualization: Evidence from the U.S. life insurance industry in the 1980s and 1990s’, The Journal of Risk and Insurance 74(3): 683–711. Jensen, M.C. and Meckling, W.H. (1976) ‘Theory of the firm: Managerial behavior, agency costs, and ownership structure’, Journal of Financial Economics 3(4): 305–360. Jensen, M.C. (1986) ‘Agency costs of free cash flow, corporate finance and takeovers’, American Economic Review 76(2): 323–329. Joskow, P.L. (1973) ‘Cartels, competition and regulation in the PL insurance industry’, The Bell Journal of Economics 4(2): 375–427. Kellner, S. and Mathewson, F.G. (1983) ‘Entry, size distribution, scale, and economies of scope in the life insurance industry’, The Journal of Business 56(1): 25–44. Lai, G. and Limpaphayom, P. (2003) ‘Organizational structure and performance: Evidence from the nonlife insurance industry in Japan’, The Journal of Risk and Insurance 70(4): 735–757. Lang, L.H.P. and Stulz, R.E. (1994) ‘Tobin’s Q, corporate diversification and firm performance’, Journal of Political Economy 102(6): 1248–1280. Liebenberg, A.P. and Sommer, D.W. (2008) ‘Effects of corporate diversification: Evidence from the property–liability insurance industry’, The Journal of Risk and Insurance 75(4): 893–919. Lorson, J. and Wagner, J. (2014) ‘Sales efficiency in life insurance: The drivers for growth in the German market’, The Geneva Papers on Risk and Insurance – Issues and Practice 39(3): 493–524. Meador, J.W., Ryan, H.E. and Schellhorn, C.D. (2000) ‘Products focus versus diversification: Estimate of X-efficiency for the U.S. life insurance industry’, in P.T. Harker and S.A. Zenios (eds) Performance of Financial Institutions: Efficiency, Innovation, Regulation, Cambridge, U.K.: University of Cambridge Press. Nath, P., Nachiappan, S. and Ramanathan, R. (2010) ‘The impact of marketing capability, operations capability and diversification strategy on performance: A resource based view’, Industrial Marketing Management 39(2): 317–329. Panzar, J.C. and Willig, R.D. (1981) ‘Economies of scope’, The American Economic Review 71(2): 268–272. Park, J., Lee, S. and Kang, H.B. (2009) ‘The insurance distribution systems and efficiency in the property-casualty insurance industry’, Managerial Finance 35(8): 670–681. Peltzman, S. (1977) ‘The gains and losses from industrial concentration’, The Journal of Law & Economics, 20(2): 229–264. Regan, L. (1997) ‘Vertical integration in the PL insurance industry: A transaction cost approach’, The Journal of Risk and Insurance 64(1): 41–62. Regan, L. (1999) ‘Expense ratios across insurance distribution systems: An analysis by line of business’, Risk Management and Insurance Review 2(2): 44–59. Rhoades, S. A. (1985) ‘Market share as a source of market power: Implications and some evidence’, Journal of Economics and Business 37(4): 343–363. Santalo, J. and Becerra, M. (2008), ‘Competition from specialized firms and the diversification–performance linkage’, The Journal of Finance 63(2): 851–883. Schmid, M. and Walter, I. (2009) ‘Do financial conglomerates create or destroy economic value?’, Journal of Financial Intermediation 18(2): 193–216. Servaes, H. (1996) ‘The value of diversification during the conglomerate merger wave’, Journal of Finance 51(4): 1201–1225. Shim, J. (2011) ‘Mergers & acquisitions, diversification and performance in the U.S. property-liability insurance industry’, Journal of Financial Services Research 39(3): 119–144,. Sommer, D.W. (1996), ‘The impact of firm risk on PL insurance prices’, The Journal of Risk and Insurance 63(3): 501–514. Teece, D.J. (1980), ‘Economies of scope and the scope of enterprise’, Journal of Economic Behavior and Organization 1(3): 233–247. Wang, J.L., Jeng, V. and Peng, J.L. (2007) ‘The Impact of corporate governance structure on the efficiency performance of insurance companies in Taiwan’, The Geneva Papers on Risk and Insurance – Issues and Practices 32(2): 264–282. Wooldridge, J.M. (2002) Econometric Analysis of Cross Section and Panel Data, Cambridge, MA: MIT Press. Yuengert, A. M. (1993) ‘The measurement of efficiency in life insurance: Estimates of a mixed normal gamma error model’, Journal of Banking and Finance, 17(2–3): 483–496.