INTERDEPENDENCE OF STOCK EXCHANGE INDICATORS AND GDP IN SELECTED BALKAN COUNTRIES

Abstract

Stock markets and the level of their development have a
great impact on economic growth. The purpose of this research is to
empirically determine if there is interdependence between gross
domestic product and (1) total turnover and (2) market capitalization
in analyzed stock markets. By analyzing the ratio between total
turnover and market capitalization into gross domestic product, the
level of liquidity and activity of these stock markets can be determined,
which enables the comparison of analyzed stock markets based on the
mentioned financial indicators. This research included Zagreb,
Ljubljana, Montenegro and the Bucharest stock market – in the period
2011-2019. The obtained results show that the analyzed markets are
small and not developed, with a low level of activity and liquidity and
they indicate the presence of interdependence between gross domestic
product and the mentioned financial indicators.