Stock market development: its impact on the economic growth in nigeria in examining the relationship between stock market development and economic growth, it is important that we throw light on some key concepts that will enhance a better understanding of the study. Growth has a positive effect on stock market development, while interest rate has a negative effect on stock market development in france key words: stock market development, economic growth, granger causality. A number of studies have discovered that stock market development is an important promoter of economic growth in an economy earlier studies focused on the contribution of the. The effect and direction of stock market capitalisation on economic growth, to determine the effect of total value of shares traded on economic growth, to establish how the equity turnover in the securities market had influenced economic growth and to examine the effect of investment. The direct effect of stock market activity can impact a nation's economy in multiple ways stocks fall, spending stops, consumers lose confidence and a nation's financial state begins to falter.
The role of a developed stock market in the development of any economy cannot be over emphasized in view of its potentials and likely impact on the economy if well harnessed it is a known fact that nations cannot develop without the needed long term funds for development projects, and the more developed a stock market is, the higher the. Since stock market activity stimulates economic growth and in turn stock market development is stimulated by economic growth, investment and other efficiency measures that induce greater liquidity and active trade can be implemented with prospect of increased economic growth. The stock market is a common feature of a modern economy and it is reputed to perform some functions that promote the growth and development of the economyâ given the above, this study is therefore carried out primarily to empirically ascertain the impact of the nigerian stock market on economic growthâ specifically, the objectives are.
Development and the effect of stock market development on the control variables can also be analyzed through the pvar model additionally, this study analyses stock market development. Get free research paper on an analysis of the impact of stock market development on economic growth in nigeria project topics and materials in nigeria this is approved for students in accountancy, business, computer science, economics, engineering, arts. With the financialcrisis subsiding over the past year, the dubai stock market once again tries to establish itselfthis paper tries to analyse the impact of the dubai stock market on its economic growth andthe various factors that has played a role in development of the economydubai's stock market position.
The imf and the world bank supported stock market development not solely on the grounds of ideology but rather that the stock market is a natural outgrowth of a developing financial sector as long-term economic growth proceeds and also as a criticism of early development efforts through development finance institutes (dfi) (singh, 2, 1993. Positive impact between the development of stock market and economic growth similarly the study of staglitz (1985), vishny (1986) and bhide (1993) suggest that stock market is dangerous to the growth of the economy. Top 10 market indicators of economic development in the hands of economists suggests our co-founder, bill bonner, in hormegeddon, the more precise the number, the bigger the lie with. The stock exchange is a pivotal institution in the capital market that marshals resources for economic activities it absorbs savings and provides liquidity for investments, helps reduce. As you would expect, this measurement of a nation's economic health has a huge effect on stock market returns any significant change in gdp- up or down- usually has a significant effect on the.
Proponents of positive relationships between stock market development and economic growth hinged their argument on the fact that the stock market aids economic growth and development through the mobilization and allocation of savings, risk diversification, liquidity creating ability. Economic growth and stock market development and found that the growth in stock market capitalization granger causes gdp growth in the pre-1914 while gdp growth granger causes stock market development in the post-second world war era. The objective of this study is to investigate the role of stock market development on economic growth in africa it uses annual data from a panel of 36 countries, of which 18 have stock markets, in africa over the period 1980-2010. Positive impact of stock market development on economic growth in developed countries some studies, including atje and jovanovic (1998), showed a large impact of stock markets on economic growth but did not witness a significant link for banking development on. Our empirical findings indicate that stock market development contributes to some extent in the economic growth of south asian region but its impact on east asian region found to be insignificant.
The results of the research, established positive links between the stock market development and economic growth, suggests the pursuit of policies geared towards rapid development of the stock market. Abstract this study uses an annual data to study the recent contribution of performance of stock markets (london stock exchange) in the economic performance of united kingdom from 2001 to 2009. Although some analysts view stock markets in developing countries as casinos that have little positive impact on economic growth, recent evidence suggests that stock markets can give a big boost to economic development.
The studies on the role of stock market development in economic growth have been increasing in recent years this study examines the relationship between stock market development and economic. Banks also promote economic growth but their stimulating effect operates independently from the stock market one explanation for this is that banks and stock exchanges serve different financial needs.