Theoretical and Empirical Study of Stock Market Development and Economic Growth: Perspective from Mexico
Abstract
Many countries across the world today compare their economies based upon the operating and performance of their capital markets. Despite of the disastrous crude oil crash in 2015, Mexico's economic climate still carried out well in 2016; nonetheless, growth slowed down in 2017 and the Mexican Central Bank needed to change its development estimates for 2018 and 2019. Stock market plays a crucial duty in economic growth and economic success of a country, the majority of developing countries in Eastern and Central Europe have carried out reforms in the monetary industry in regards to restructuring and privatization of public business and the establishment or growth of capital markets. In developing nations, the best participants in the funding markets are people, or homes provided as capitalists. Resources markets in less-developed countries, are also shallow in terms of market capitalization as a result of the limited number of listed firms and a limited number of individuals (people). Regardless of the substantial study carried out in the location a discussion still exists on the informal connection between stock exchange advancement and financial development. This research study analyzed theoretically and empirically the partnership between stock market advancement and financial development perspective from Mexico. The study found that that stock market advancement favorably impact financial growth in Mexico both in the short term run and long term. This study found that the long-run relationship between securities market growth and economic development with both datasets and, long-run origin ranging from economic development to stock exchange development, and temporary bi-directional origin between the variables. The study concluded that the development of stock exchange depends upon of lots of aspects, both international as national, but most importantly them results more direct will certainly result this last, because will certainly be that objective directly the evolution of the very same.
Keywords. Theoretical, Stock market, Development, Economic, Growth, Mexico
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