Abstract
Small and medium-sized enterprises are the foundation for the development of each contemporary national economy. Their number affects macroeconomic indices of economies and directly translates into the labour market created by SMEs. This article aims to investigate the key conditionings behind the macroeconomic significance and legal factors of the financial market operation in Poland and the UK, with particular emphasis on the stock exchange as the fundamental element of the capital market. Both AIM and NewConnect are platforms dedicated to SMEs, which have been allowed easier access to this capital market segment by minimising mandatory legal conditions. This study analyses the number of listed companies and their capitalisation values in 1999–2015, covering: the rules of the financial market operation, with a special focus on the legal bases of the stock market operation in the economies investigated; legal conditions for the development of this economic segment; and a detailed analysis of the number of participants and capitalisation values achieved on the Warsaw and London Stock Exchanges, in particular AIM and NewConnect. This paper builds on source data from various annual reports and stock exchange publications drawn up and made available by stock exchanges and financial supervisors. The attempt to compare the indices and capacities of the WSE and the NC with the biggest European player is motivated by the fact that the Warsaw Stock Exchange is classified as the largest and most dynamically growing stock exchange in Central and Eastern Europe.
Highlights
Money surplus among the operators who were eager to make it available to those with shortages of funds is the foundation of the financial system functioning in a market economy (Smith 2000, 2016)
Owing to its basic functions as a public capital market, the stock exchange is of fundamental importance to capital flows and development of economies, both nationally and globally (Altman 1968; Płókarz 2013; Małecka 2015a, 2015b)
Its activities and offer are a source of development capital, providing an alternative to the banking sector
Summary
Money surplus among the operators who were eager to make it available to those with shortages of funds is the foundation of the financial system functioning in a market economy (Smith 2000, 2016). There were no legal norms governing the operation of many, even basic, financial market segments, no law on public trading in securities or act on investment funds. The WSE and the Polish OTC market equivalent, namely the Central Table of Offers (CTO), operate under their statutes, rules and detailed trading regulations (Warsaw Stock Exchange 2015; Bondspot 2015). Skilful and effective popularisation of information about how to construct capital market instruments, along with dissemination of this knowledge among SMEs, is of crucial importance This applies to security, regulations and legal norms in view of the fact that SMEs are the main target group for alternative trading systems as regards potential cooperation. The LSE has experienced fluctuations (the biggest increase of 26.7% in 2012, when both the regular market and the AIM attracted considerable interest; the biggest drop of 25.8% one year later over the previous year can be seen on both markets) (Tables 2 and 3)
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