The need to develop securities market has following the recent international financial crises increasingly attracted the attention of national and international policy makers.
Never before have developed and developing countries shared such a strong interest in ensuring the stable growth of international capital flows. And yet, the key question for policymakers is how to channel these gains into investments that promote development, sustainable poverty reduction and social equity. Using the African scenario, this paper argued that although many of the institutions needed for strong income growth and asset accumulations are equally
important in fostering social assets, the institutional underpinnings of sustainable development are somewhat broader. They rest on greater access to information and knowledge and the ability to form broader partnership. Without these additional institutional elements, society risks fragmentation that imperils both income growth and well-being.
Nothing that market exchange plays a larger role in Africa, we also argued that the presence of transaction costs naturally leads market participants to enter in long term trading relationships (and these relationships form business net works that shape market outcomes) with minimum risks. However, when societies become more equitable in ways that lead to greater opportunities for all, the poor stand to benefit from a “double dividend”.