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An Essay on the Emergence, Organization and Performance of Financial Markets: the case of the Alternative Investment Market

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  • Valerie Revest
  • Sandro Sapio

Abstract

This work provides an overview of the historical evolution, the organizational forms, and the performances of the stock exchanges and market segments catering to small and growing companies, set up in Europe in the last thirty years. We mainly focus on the Alternative Investment Market (AIM), created by the London Stock Exchange in 1995. This case study yields useful insights about the role of public and private interests in market emergence and in shaping market architectures, the costs and benefits of light stock market regulation, and the use of stock markets to support technology-based small firms. A review of the existing empirical evidence shows that dimensional growth of the AIM has been fueled by companies characterized by low values of long-term returns, growth rates, R&D productivity and solvency.

Suggested Citation

  • Valerie Revest & Sandro Sapio, 2011. "An Essay on the Emergence, Organization and Performance of Financial Markets: the case of the Alternative Investment Market," LEM Papers Series 2011/15, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
  • Handle: RePEc:ssa:lemwps:2011/15
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    Cited by:

    1. Giovanni Dosi & Valérie Revest & Alessandro Sapio, 2016. "Financial regimes, financialization patterns and industrial performances : preliminary remarks," Post-Print halshs-01418040, HAL.

    More about this item

    Keywords

    Public equity; Market emergence; Market design; Alternative Investment Market; High-tech; Small firms;

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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