ROLE OF CAPITAL MARKET IN A DEVELOPING ECONOMY (CASE STUDY OF STOCK EXCHANGE)
CHAPTERÂ Â Â ONE
OVERVIEW OF THE STUDY
The capital market is the market for dealings,( that is lending and borrowing ) In long –term loan able fund. The market is a source from which industries obtain its capital for establishment expansion and modernization and from which the government borrows on long term basis for development purpose it offers access to varieties of various instrument that enable economic agent to pool, price and exchange risks through assets with affricative fields liquidity and risk characteristics. It encourages savings in financial form. This is very important for government and other institutions in need of long-term funds and for suppliers of long-term fund who because of the native of their liabilities undertake to maintain parts of their assets in the relatively liquid form (Ekeizie 1997)
According to Kanu N.O.N (2004) capital market refers to that market for the mobilization of medium and long term fund. From the surplus units for allocation to the deficits units of the economy the market provide opportunities for the insurance and resale’s of government securities co-operate funds, stocks, shares, and mortgage loans.
A broad definition of the term capital market according to Alile (1986) The entire financial systems, commercial banks and other financial institution providing short term and long term to finance both consumption and investment while an intermediate definition would include only those institution which are concaves with providing with long term , the a new definition of capital market rulers to it as involving the problem and prospects of equity investment
This relates to the issue an d market of share bonds debentures and other long term using the services of brokers dealers ad under writer
A sketch of a capital market
The presidency
The federal ministry of finance
Securities and exchange commission
Capital market
Nigeria stock exchange
Stock brokers and issuing house
Instrument
1.1 It is important we know that the capital market was not in existence before the independent in 1960, rather what was in existence was a financial system . the absence of a capital market within that period s hindered economic development the won exchange of this market to invest them in the country meant that Nigeria who had surplus fids had no such market to invest them in the country as a result of this  they repatriated such funds for investment overseas I hand on thus resulting to export of capital which would have use in the economic development of Nigeria in addition it resulted to lack market
Where Nigeria industrialist and business men course raise capital for the operation and constitution for their business on the other side of the government there was o effective tool for monetary police and control with the above situation there is no need to provide a local government market for the borrowing and handing of long term funds for  the economic development of Nigeria to achieve this objective the central bank of Nigeria went into operation on 1st of july 1959 in that same year the Nigeria stock exchange was established and the actual operation started in1961 with in the listed on the exchange the most of the listed companies have foreign/multinational affiliation and represent across section of the economy ranging from agriculture through manufacturing to service
Following the sevegelation f the capital market in 1993, the federal government I 1995 international the capital market foreigners can now participate In the Nigeria capital market both as operators and investors with this the stock exchange has linked up with the roufes
Electronic contributors system which is a form of information communication system that assist online global business nation of stock market information like trading statistics all share index e.t.c all these have contributed to the development of the economy
1.2 STATEMENT OF THE PROBLEM
Although the capital market has contributed significantly to the growth and industrialization of the country  economy certain problems still contain its operational option they include
INFRASTRUCTURAL INADEQUTIES :this has resulted in salary in effecting transaction between issuance houses brokers sealers registrars investors and their banks the service discouraged many investors who some times view with their registrar and brokers when there  certificates are under levees or proceeds of share sold not . also infrastructural institution insulate many investors especially those in the rural areas from participating effectively in international trading there by hindering development since the rural traders are band of the necessary securities needed to participate in international trading
- Generally ignorance also on the part on most members of the Nigerian public so as to the meaning of shares and stock s as well as the benefit from market operations
- Reluctance of the Nigeria business men to go to the public for the fear of losing control of family business
- Macro economy instabilities and high cost of raising fung in the market.
- Polities instability which makes returns and premium uncertain and thereby discourage prospective investors both local and foreign
1.3 OBJECTIVE OF THE STUDY
Having the above problem in mind as militating against the industrialization  of capital market vie stock exchange market , the purpose of this study is to determine
- The contribution of the capital market to economic growth
- The contribution of capital market in national development
- To enumerate the usefulness of Nigeria stock market in the industrialization of national economy.
1.4 RESEARCH QUESTIONS
1 .does lack of public awareness militate against realization of the potentials of the stock market in founds mobilization
- Does the capital market play any role in the industrialization of a country?
- Political instability influence the industrialization of a country capital market?
1.5 SCOPE OF THE STUDY
This research work revolves on the Nigeria stock exchange and how it aids the capital market in a industrialization in a country  like ours. It is important to note that the capital market in not a single entity rather it in a network of specialized financial institution that in various ways bring together suppliers and users of capital which be fully emphasized in this study it well also examine the various regulatory bodies of a capital market especially in Nigeria stock exchange .
Thus, the scope will cover the Nigeria stock market its operation and impact in the economy generally.
