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STOCK MARKETS AND ECONOMIC DEVELOPMENTStock Markets and Economic GrowthIntroductionIt is a matter of fact that during the last decades the personal credit lines which were listed in the job markets of the whole world has importantly increased to 15 , 2 trillion . The share of chapiterisation represented by developing and developed markets rose to well-nigh 13 from 4 . It is necessary to note that trading is besides constantly increasing in developing and emerging markets much(prenominal) as Taiwan Korea , India , Mexico , etc . The value of traded shares was reported to rise from 3 to 17 during last years (Artesis 2006It is suggested by theoretical economists and financiers that stock markets are able nowadays to promote long-run stintingal step-up . Stock markets are told to stimulate specialization , statistical distribution and receiving relevant information . thitherfore stock markets can garnish significantly the costs of mobilizing savings and assist attracting foreign investors It is cognise that stock markets in highly developed countries such as Germany may intensify and encourage corporate control by means of facilitating the problem principal-agent . The problem may be puzzle out through consolidating the interests of managers and demands of owners and as the result the managers would strive to achieve goals and to maximize the value of the firm (Artesis 2006Stock Markets : Impact on Economic GrowthAlthough rough critics analyze that stock markets have little positive exertion on the country s economic growth , many other(a) analysts and evidence stress that stock markets are necessary for economic growth and they are able to provide the developing countries (Taiwan , Malaysia with a big boost to economic growth and further increase . It is known that stock markets are connected with the economic growth through the creation of liquidity . It means that really productive coronations demand just long-turn capital commitment , but investors wear down t command to relinquish their capital for such long succession without any control Actually liquid stock markets pee their investments to a greater extent secure and in such right smart more than attractive .

Stock markets allow investors to acquire equity (an plus ) and then to sell it rather quickly and without any problems if investors want to spoil access to their investments or they want to change their portfolios . Levine admits that at the same time companies enjoy permanent access to capital raised through equity issues (Stiglitz 2006Liquid stock markets facilitate long-run investments and make them more profitable . Therefore it is apparent that stock markets are necessary and important for economic growth , because they better capital allocation and in such a way they enhance prospects for long-term economic development . Stock markets as it was mentioned above make investments more secure and attractive . What is more important is that stock markets can create more investment opportunities . In other words investors lead be attracted , because they will be provided with possibility to leave if they want (Tokyo Stock supervene upon 2006In fact there are more ideas how stock markets usurp and assist long-term economic growth of the country . There is a suggestion that stock markets stimulate investor s short...If you want to get a full essay, order it on our website: Orderessay

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