Abstract

The financial markets play a key role in equipping and guiding the funds existent in the economy towards production and industrial sectors and subsequently bringing about economic improvements and growth to the extent that in some economists’ ideas, the expansion of the financial markets propels the countries’ economic growth. The objective of financial markets’ development chased by a majority of the developing countries during the recent decades has been a revitalization of the financial markets and improving the efficiency of making use of financial resources. Investment plays a determinative role in the economic growth. One of the fundamental goals pursued by the countries is an achievement of economic growth and development. In the literature on the economy, capital has been described as the vital vein of an economic system and there has been made a lot of emphasis on its formation as the most important determinant factor of the economic growth and development. The degree of the economic growth and development depends on the accumulation and productivity of the economy and these two rely on the quality with which the investments are made. As for the economic growth and development, reference has to be made to the money and credit institutions and securities market that formulate the main premises of the financial markets. These aforesaid institutions play considerable roles in supplying the economical capitals and elevation of productivity. The present study tries to investigate the theoretical literature on the financial markets, both from the inside and outside the country, so as to identify the factors influencing the financial market growth and development and investigate the effect of each of them on the economic growth and development enhancement.