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Should Africa promote stock market capitalism?

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  • Ajit Singh

    (Professor of Economics, University of Cambridge, Cambridge, UK)

Abstract

This paper considers the pros and cons of establishing stock markets in sub-Saharan African economies at the present stage of their development. It provides theoretical analysis and empirical evidence from both developing and advanced countries to argue that for many African countries such a development would be a costly irrelevance which they can ill afford; for a number of others, it is likely to do more harm than good. The African countries would do better to use their scarce human, material, and institutional resources to improve their banking systems than to promote stock markets. Copyright © 1999 John Wiley & Sons, Ltd.

Suggested Citation

  • Ajit Singh, 1999. "Should Africa promote stock market capitalism?," Journal of International Development, John Wiley & Sons, Ltd., vol. 11(3), pages 343-365.
    • Handle: RePEc:wly:jintdv:v:11:y:1999:i:3:p:343-365
    DOI: 10.1002/(SICI)1099-1328(199905/06)11:3<343::AID-JID593>3.0.CO;2-Q
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    References listed on IDEAS

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    4. Martin BROWNBRIDGE, 1998. "The Causes Of Financial Distress In Local Banks In Africa And Implications For Prudential Policy," UNCTAD Discussion Papers 132, United Nations Conference on Trade and Development.
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    6. Mohamed A. El-Erian & Manmohan S. Kumar, 1995. "Emerging Equity Markets in Middle Eastern Countries," IMF Staff Papers, Palgrave Macmillan, vol. 42(2), pages 313-343, June.
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    9. Ajit Singh, 1998. "Financial liberalisation, stockmarkets and economic development," Nova Economia, Economics Department, Universidade Federal de Minas Gerais (Brazil), vol. 8(1), pages 165-182.
    10. Jean Tirole, 1991. "Privatization in Eastern Europe: Incentives and the Economics of Transition," NBER Chapters, in: NBER Macroeconomics Annual 1991, Volume 6, pages 221-268, National Bureau of Economic Research, Inc.
    11. Mayer,Colin & Vives,Xavier (ed.), 1993. "Capital Markets and Financial Intermediation," Cambridge Books, Cambridge University Press, number 9780521443975, September.
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    20. Cho, Yoon Je, 1989. "Finance and Development: The Korean Approach," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 5(4), pages 88-102, Winter.
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    More about this item

    JEL classification:

    • F0 - International Economics - - General
    • G1 - Financial Economics - - General Financial Markets
    • G2 - Financial Economics - - Financial Institutions and Services

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