Stock Exchange Governance and Market Quality

We show that organization structure of a stock exchange matters by utilizing the unique setting prevailing in India. India has two major stock markets, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). These two exchanges adopt similar trading systems, trade essentially identica...

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Main Authors: KRISHNAMURTI, Chandrasekhar, SEQUEIRA, John M., FU, Fangjian
Format: text
Language:English
Published: Institutional Knowledge at Singapore Management University 2003
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Online Access:https://ink.library.smu.edu.sg/lkcsb_research/633
https://ink.library.smu.edu.sg/context/lkcsb_research/article/1632/viewcontent/Stock_Exchange_Governance_and_Market_Quality.pdf
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spelling sg-smu-ink.lkcsb_research-16322018-09-05T00:53:12Z Stock Exchange Governance and Market Quality KRISHNAMURTI, Chandrasekhar SEQUEIRA, John M. FU, Fangjian We show that organization structure of a stock exchange matters by utilizing the unique setting prevailing in India. India has two major stock markets, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). These two exchanges adopt similar trading systems, trade essentially identical stocks, and follow the same trading hours. However, these exchanges have different organizational structures: BSE is mutualized whereas NSE is demutualized. Using the Hasbrouck [Review of Financial Studies 6 (1993) 191] measure of market quality we show that NSE provides a better quality market than BSE. This result is consistent with the work of Domowitz and Steil [Brookings-Wharton Papers on Financial Services, 1999], who proposed that demutualized exchanges are superior to mutualized in governance. 2003-09-01T07:00:00Z text application/pdf https://ink.library.smu.edu.sg/lkcsb_research/633 info:doi/10.1016/s0378-4266(03)00105-5 https://ink.library.smu.edu.sg/context/lkcsb_research/article/1632/viewcontent/Stock_Exchange_Governance_and_Market_Quality.pdf http://creativecommons.org/licenses/by-nc-nd/4.0/ Research Collection Lee Kong Chian School Of Business eng Institutional Knowledge at Singapore Management University stock exchange governance demutualization market quality India stock exchange stock prices Finance and Financial Management Portfolio and Security Analysis
institution Singapore Management University
building SMU Libraries
continent Asia
country Singapore
Singapore
content_provider SMU Libraries
collection InK@SMU
language English
topic stock exchange governance
demutualization
market quality
India
stock exchange
stock prices
Finance and Financial Management
Portfolio and Security Analysis
spellingShingle stock exchange governance
demutualization
market quality
India
stock exchange
stock prices
Finance and Financial Management
Portfolio and Security Analysis
KRISHNAMURTI, Chandrasekhar
SEQUEIRA, John M.
FU, Fangjian
Stock Exchange Governance and Market Quality
description We show that organization structure of a stock exchange matters by utilizing the unique setting prevailing in India. India has two major stock markets, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). These two exchanges adopt similar trading systems, trade essentially identical stocks, and follow the same trading hours. However, these exchanges have different organizational structures: BSE is mutualized whereas NSE is demutualized. Using the Hasbrouck [Review of Financial Studies 6 (1993) 191] measure of market quality we show that NSE provides a better quality market than BSE. This result is consistent with the work of Domowitz and Steil [Brookings-Wharton Papers on Financial Services, 1999], who proposed that demutualized exchanges are superior to mutualized in governance.
format text
author KRISHNAMURTI, Chandrasekhar
SEQUEIRA, John M.
FU, Fangjian
author_facet KRISHNAMURTI, Chandrasekhar
SEQUEIRA, John M.
FU, Fangjian
author_sort KRISHNAMURTI, Chandrasekhar
title Stock Exchange Governance and Market Quality
title_short Stock Exchange Governance and Market Quality
title_full Stock Exchange Governance and Market Quality
title_fullStr Stock Exchange Governance and Market Quality
title_full_unstemmed Stock Exchange Governance and Market Quality
title_sort stock exchange governance and market quality
publisher Institutional Knowledge at Singapore Management University
publishDate 2003
url https://ink.library.smu.edu.sg/lkcsb_research/633
https://ink.library.smu.edu.sg/context/lkcsb_research/article/1632/viewcontent/Stock_Exchange_Governance_and_Market_Quality.pdf
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