Journal article
Enterprise risk management and economies of scale and scope: evidence from the German insurance industry
Annals of operations research, Vol.299(1-2), pp.811-845
04/01/2021
DOI: 10.1007/s10479-019-03393-x
Abstract
Enterprise risk management (ERM) is the approach of managing all risks faced by an enterprise in an integrated, holistic fashion. This research investigates whether the utilization of the ERM approach helps firms achieve economies of scale and scope. We use detailed survey data of German property-liability insurance companies that allows us to construct continuous measures of ERM quality. We find that ERM quality positively moderates the size-scale efficiency relationship, and we find that ERM positively moderates the diversification-revenue scope efficiency relationship, indicating that ERM facilitates economies of scale and economies of scope with respect to revenue complementarities. We do not find any evidence of economies of scope with respect to cost complementarities. Our results suggest that ERM’s impact on economies of scale and scope is one answer to the question of
how
ERM can create value.
Details
- Title: Subtitle
- Enterprise risk management and economies of scale and scope: evidence from the German insurance industry
- Creators
- Muhammed Altuntas - University of CologneThomas R. Berry-Stölzle - University of IowaJ. David Cummins - Temple University
- Resource Type
- Journal article
- Publication Details
- Annals of operations research, Vol.299(1-2), pp.811-845
- Publisher
- Springer US
- DOI
- 10.1007/s10479-019-03393-x
- ISSN
- 0254-5330
- eISSN
- 1572-9338
- Language
- English
- Date published
- 04/01/2021
- Academic Unit
- Finance
- Record Identifier
- 9984380489002771
Metrics
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