Corporate Governance, Stock Market Development and Private Capital Accumulation : A Case Study of India

In the present LPG (Liberalisation, Privatisation and Globalisation) regime the stock market has been assigned to play an important role. There is now a call for better corporate governance in order to protect the interests of the share holders. In this perspective the Centre for Business Research (at Judge Business School, University of Cambridge) has produced a comprehensive time series dataset for corporate governance with reference to shareholder protection for a number of countries including India. The coverage of the dataset is much more comprehensive than that of the LLSV index (La Porta et al, 1998). The paper examines this dataset to answer the question whether the government concern for corporate governance is misplaced - whether more and more reliance on private sector for capital accumulation and development through popularisation of stock market works