MARKET OF FINANCIAL SERVICES

GAMANKOVA Olga ¹, HAMANKOV Dmytro Volodymyrovych, DYMNICH Olha ²

¹Kyiv National Economic University
²Kyiv National Economic University named after Vadym Hetman

Theoretical basis for determining the role and place of state for insurance market

The article deals with the theoretical basis to determine the role and the place of the state for insurance market in view of the features of neoclassical and neo-institutional approaches. Neoclassical theory, which in recent decades was considered as mainstream economic thought and explained the need for the state intervention only by “market failure” in the present is no longer seen as having no alternative. Views on the insurance market, its effectiveness, sustainability and limits have been changed under the influence of other contemporary theories, such as neo-institutionalism. The policy of non-interference (minimum of the state intervention to the economy and mild regulation and supervision policy) did not live up to expectations of the society and led to the global financial crisis. Strengthening the regulatory influence was dominant of the modern scientific views and confirmed the trend, which is observed in developed financial markets over the past 20 years: expansion of the government regulation while strengthening the public control over the activities of government agencies. Insurance market as a part of the financial sector of the economy should be the subject to the regulatory influence to ensure its stable operation and protect the interests of insurance consumers.

Keywords: neo-classicism, neo-institutionalism, insurance markets, market failures, public consumption services, information asymmetries, state regulation

JEL: G22, G28, G29

GAMANKOVA O. . Theoretical basis for determining the role and place of state for insurance market / O. . GAMANKOVA , D. V. HAMANKOV , O. . Dymnich // Фінанси України. - 2014. - № 9. - C. 65-78.