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Capital Market Development and Emergence of Institutional Investors in the Asia-Pacific Region

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  • Hans Genberg

    (Advisor on Macroeconomics and Monetary Policy Management, South East Asian Central Banks (SEACEN) Research and Training Centre, Malaysia)

Abstract

This paper was prepared for ESCAP by Hans Genberg. It is generally agreed that capital markets has an important role to play in the intermediation of funds from savers and investors. While banks have traditionally been a mains source of finance for investments in developing and emerging markets, it is recognized that active bond and equity markets serve an important complementary role. The view that a vibrant financial sector has a positive effect on economic growth and development has long been uncontroversial. Recently, however, and as a reaction to the financial crisis in the United States and Euro Area, some economists have argued that if it grows beyond a certain size, the financial sector may become so large that its marginal contribution to growth is negative. The size at which this occurs appears relevant mostly for advanced economies and is far beyond the current state of financial development in developing and emerging markets in general and in the Asia-Pacific region in particular. This paper thus proceeds on the premise that further development of capital markets in developing and emerging markets is beneficial, and asks what can be done to encourage growth in bond and equity markets. Particular emphasis is put on what measures might be taken induce financial markets to channel funds to infrastructure and sustainable development investments and on the role that institutional investors may play in this process.

Suggested Citation

  • Hans Genberg, 2015. "Capital Market Development and Emergence of Institutional Investors in the Asia-Pacific Region," MPDD Working Paper Series WP/15/03, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
  • Handle: RePEc:unt:wpmpdd:wp/15/03
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Hans Genberg, 2017. "Financial Integration in Asia," Working Papers wp22, South East Asian Central Banks (SEACEN) Research and Training Centre.
    2. Hyeladi Stanley Dibal & Habila Abel Haruna & Chinyere C. Onyejiaku & Ogbole Friday Ogbole & Josaphat Uchechukwu J. Onwumere, 2024. "Pension Fund Investments and Capital Market Development in Nigeria: The Moderating Role of Inflation," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 16(2), pages 248-269, May.
    3. Michael Regan, 2017. "Capital Markets, Infrastructure Investment and Growth in the Asia Pacific Region," IJFS, MDPI, vol. 5(1), pages 1-28, February.

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    More about this item

    Keywords

    Financing; infrastructure; Public-Private Partnerships; Asia Pacific.;
    All these keywords.

    JEL classification:

    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy

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