STOCK MARKET PERFORMANCE, CAPITAL FORMATION, AND ECONOMIC GROWTH: EVIDENCE FROM INDIA

Abstract

The stock market, according to experts, politicians, and academics, has been a major factor in the economic progress of developed and developing countries alike during the past few decades due to its effective allocation of capital. In the field of economics, there has been a long-running debate about whether rising stock prices cause or contribute to increased economic activity. The correlation between a thriving economy and rising stock prices is the root cause of this phenomenon. Considering its age, size, and development, the Indian capital market appears to go unnoticed, with only 0.1 units of research conducted per institution annually. This article takes a look at how India's capital market has impacted the country's economic growth.