A Note on the Role of Ldcs Security Markets in Savings Mobilization

Journal of Development Studies, Vol. V, pp. 41-50, 1983

Posted: 2 Mar 2006

See all articles by Arnaldo Mauri

Arnaldo Mauri

Università Degli Studi di Milano

Andrea Calamanti

University of Ferrara - Faculty of Economics

Abstract

A widespread debate among development economists and policy makers focuses on the issue whether setting up securities markets in less developed countries can and will increase their savings rates and, by this way, generate substantial economic benefits. The paper attempts to contribute to the debate. The investigation encompasses relationship between development of securities markets in a backward context and improvement of savings mobilization process, the latter conceived in terms both of increase of gross private savings rate and of enhancement of the efficiency in allocating capital resources. The results of the analysis suggest that the opportunities to expand aggregate savings by establishing securities markets depend on a variety of conditions and limiting factors related to each socio-economic context. Given that most of these constraints exist, such opportunities are to be assessed on a case-by-case basis. In conclusion, according to the Authors, it should not be assumed that the introduction of this innovation in the financial scene of a less developed country will necessarily and significantly improve savings mobilization process. Indeed, with particular reference to the early stages of development, it might be observed that the establishment of security markets it is likely to affect only modestly private savings rates and resource allocation.

Keywords: Savings Mobilization, Securities Markets, Household Savings

JEL Classification: E21, E44, O16

Suggested Citation

Mauri, Arnaldo and Calamanti, Andrea, A Note on the Role of Ldcs Security Markets in Savings Mobilization. Journal of Development Studies, Vol. V, pp. 41-50, 1983, Available at SSRN: https://ssrn.com/abstract=886661

Arnaldo Mauri (Contact Author)

Università Degli Studi di Milano ( email )

Milan, 20122
Italy

Andrea Calamanti

University of Ferrara - Faculty of Economics ( email )

C.so Ercole I° d'Este 37
Ferrara, 44100
Italy

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