FINANCIAL-MARKETS AND SOCIAL-WELFARE

This article is a transcript of the author's speech made in commemorat ion of her appointment as a professor. The author discusses the role o f the financial markets in the economy and their effect on welfare, We ll-developed financial markets, with a great variety of financial inst ruments tend to spread the risks and develop ways of hedging against r isks. Studies have shown that well-developed financial markets in fact can increase social welfare and thus the Government should promote th e development of efficient financial markets.