Productivity,scale economies and technical progress in the Canadian life insurance industry

The purpose of this paper is to examine the productivity performance of the Canadian life insurance industry. We construct a measure of total factor productivity for life insurance companies and then attempt to determine the main sources of improved productivity during the period 1961–1977 by pooling time-series and cross-section data from 31 firms. We conclude that for the industry as a whole technical progress was by far the most important source of productivity growth, while scale economies, on balance, had a marginally negative impact.