Capital Market, Needs for Improvement of Business Environment (in Persian)

Financial systems are classified as bank-based systems and market-based systems. In bank systems¡ savings are gathered and credits are allocated by banks. In market systems¡ capital market helps the capital accumulation and economic development and supplies resources required for economic activities through providing savers with profitable investment opportunities. While these two systems exist in many countries¡ their importance (weight) varies from one country to another. In Iran¡ although the financial system is bank- based¡ the creation¡ establishment and maintaining an efficient¡ transparent¡ and sound capital market are required for improvement of the business environment¡ and in contrast¡ the environment affects the development¡ size and depth of the capital market. Iranian capital market has been seriously considered by general policies of the Article 44 of the Constitution of Islamic Republic of Iran and the relevant Act¡ the Fourth Development Plan¡ and general policies of the Fifth Development Plan. In order to make an efficient capital market and to meet expectations from it¡ we need to recognize effects of the business environment on the capital market and vice versa. The Paper is intended to provide this recognition.The Paper primarily examines the materiality of the financial system and financial development and then it describes capital market. Also¡ it analyzes factors affecting the capital market¡ including legal environment¡ economic environment¡ social and cultural environment¡ information and communication technology¡ and payment and settlement technology. Then it discusses current conditions in Iran and improvement opportunities in relation to the above mentioned factors. Finally¡ the paper clarifies the implications of a developed capital market from the view points of the capital availability¡ liquidity¡ risk distribution¡ and capital cost and it examines these variables in Iranian capital market.