'Nascent stock markets: Explaining success and failure?'
An exploration of the performance of stock exchanges opened since 1975 across a sample of countries.
Well-developed and efficient financial markets are important contributors to the economic growth of developing economies. Unfortunately, many low- and middle-income countries lack liquid public capital markets. This column explores the performance of stock exchanges opened since 1975 across a sample of countries.
A minimum number of listings and turnover in the first five years appear to be necessary conditions for success over the first two decades. Developing countries considering opening a stock exchange should ensure that there is sufficient interest from firms and investors.
Research project - determinants of success and failure in new stock markets
This article and the ISS working paper on which it is based,is the result of a research project on the determinants of success and failure in new stock markets around the world initiated by the Erasmus Financial Markets Centre (EFMC, Rotterdam School of management), the Economics of Development and Emerging Markets (EDEM) research programme at ISS and Cass Business School (London).
The project aims at understanding how stock market structures evolve and which executable government policies can boost financial market development (and potentially economic growth).