Stock market development: building a risk society since 1688

Catherine R Macaulay

International Review of Applied Economics, 2025, vol. 39, issue 6, 880-903

Abstract: Created by speculators in Amsterdam in 1602, and unstable ever since, stock markets have become central to economies globally, despite being recognised as a significant contributor to today’s risk society. History exposes questionable reasons for the stock market’s rise and reveals reversion to a more productive economic framework to be a way of reducing societal risk. The stock market’s spontaneous development by opportunists in London following the 1688 ‘Glorious Revolution’ spread a non-essential, localised, and speculative market to the international political economy. This precipitated London’s first Big Bang: the privatisation of the Bank of England and stock market deregulation, followed by the South Sea Bubble within thirty years. Economists subsequently embedded the market in economic theory. Keynes’ re-definition of ‘investment’ to include share trading began an ontological drift that made stock markets a hallmark of capitalism. Unlike Knight, Keynes’ concern was share-trading risk, and the uncertainty of the unknown future remains an unresolved challenge for risk analysts, speculators, and regulators, their conflicting goals militating against regulation and stability. Re-building the successful capitalist framework that was abandoned as share markets attracted unjustifiable support, remains a viable alternative to continuing centuries of efforts to manage share-trading risks and the uncertainty of an unknowable future.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/02692171.2024.2333340 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:irapec:v:39:y:2025:i:6:p:880-903

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/CIRA20

DOI: 10.1080/02692171.2024.2333340

Access Statistics for this article

International Review of Applied Economics is currently edited by Professor Malcolm Sawyer

More articles in International Review of Applied Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().