Journal of Productivity Analysis

, Volume 49, Issue 1, pp 49–64 | Cite as

A cost efficiency analysis of the insurance industry in Mexico

  • Ana María Reyna
  • Hugo J. Fuentes


In Mexico, the low participation of insurance activity in national production, in contrast to similar Latin American economies, is a concern. Industry’s regulator promoted more intense competition at the dawn of the century. Was deregulation followed by improvements in the financial and economic performance of Mexican insurance firms? The purpose of this paper is to answer this question through a comprehensive analysis of cost variations in an intertemporal manner, by breaking them down into the economic sources that produce them, including productivity. Cost frontier estimation was grounded in a joint production technology of desirable and undesirable outputs, modeled in an input-oriented fashion. Our results demonstrate that even though some companies achieved cost reductions from technological progress or improvements in efficiency, the Mexican insurance market does not show signs of significant productivity gains.


Insurance Cost efficiency DEA Undesirable outputs 

JEL codes

C14; C67 D61 G14 G22 


Compliance with ethical standards

Conflict of interest

The authors declare that they have no competing interests.


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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2017

Authors and Affiliations

  1. 1.GNPCiudad de MéxicoMexico
  2. 2.ITESM CCMCiudad de MéxicoMexico

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