Nexus of Institutional Quality and Stock Market Development: Long-Run Relationships in Dynamic Heterogeneous Panel

Authors

  • Muhammad Saeed Meo The Superior College, Lahore, Pakistan
  • Ramzan Ali The University of Lahore
  • Bilal Aziz Poswal The University of Lahore
  • Mubbshar Ali University of the Punjab

DOI:

https://doi.org/10.31384/jisrmsse/(2018).16.2.2

Keywords:

Stock Market Performance, Political Stability, Government Effectiveness, Regulatory Quality, Rule of Law, Control of Corruption

Abstract

The current study is intended to analyze the relationship between stock market development and institutional quality. The study is based on the evidence of VISTA alliance for the period of 1984 to 2012. The outcomes of the panel ARDL (PMG) revealed that high regulatory quality, government effectiveness and rule of law, positively affect stock market development in the long-run. While political stability and control over corrupt practices have a significantly negative effect on stock market development. This study provides robust evidence that institutional quality plays a critical role in stock market development in any economy. However, governments should motivate employees to work with motivation by giving rewards, so that corrupt practices can be reduced.

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Published

2018-12-31

How to Cite

Meo, M. S., Ali, R., Poswal, B. A., & Ali, M. (2018). Nexus of Institutional Quality and Stock Market Development: Long-Run Relationships in Dynamic Heterogeneous Panel. JISR Management and Social Sciences & Economics, 16(2), 25–34. https://doi.org/10.31384/jisrmsse/(2018).16.2.2

Issue

Vol. 16 No. 2 (2018): JISR-MSSE

Section

Original Articles

License

Copyright (c) 2018 Author

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

Copyright: The Authors 

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