Equity markets and economic development: Does the primary market matter?

Andriansyah Andriansyah and George Messinis

MPRA Paper from University Library of Munich, Germany

Abstract: This article examines the role played by primary and secondary equity markets in economic growth. It departs from standard literature to integrate both markets and explicitly acknowledge the primary equity market. By employing a variety of dynamic panel estimators for 54 countries over the period 1995-2010, we show that the primary equity market is not an important determinant of economic growth, although it facilitates the development of the secondary market. This study also confirms the importance of liquidity provided by the secondary market. The evidence here calls for further investigation into the capital-raising function of equity markets.

Keywords: Equity Markets; Primary Markets; Secondary Markets; Development (search for similar items in EconPapers)
JEL-codes: E44 G23 O16 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (4)

Published in The Economic Record 90.June(2014): pp. 127-141

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Journal Article: Equity Markets and Economic Development: Does the Primary Market Matter? (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:116698

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