ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Regulating Microfinance Institutions

Recent events in India have brought a fresh focus on the appropriate regulatory stance towards microfinance. This paper analyses the puzzles of financial regulation in this field from first principles and argues that mainstream mechanisms of consumer protection and micro-prudential regulation need to be modified. From this perspective, it suggests regulatory strategies that need to be adopted for dealing with microcredit and financial distribution that focus on the poor. This conceptual framework also helps analyse two policy responses, viz, the Malegam Report and the draft Microfinance Bill, 2011.

Resilience of Liquidity in Indian Securities Markets

Liquid securities markets are a core goal of financial sector reforms, and this has two dimensions: low impact cost and high resilience. We employ elements of evidence to suggest that equity market liquidity is robust to negative price shocks. However, bond market liquidity appears fragile when faced with negative price shocks.

Institutional Mechanisms in Pension Fund Management

Retirement income plans in India face one or more of three common problems: poor funding, inadequate diversification, and weak governance. This paper discusses policy issues raised by these problems in the context of three case studies - the Indian Railways Pension Fund, the Employees Provident Fund, and the Seamen's Provident Fund. It examines means to reform these pension funds, drawing upon both Indian and international evidence and experience. Using these case studies as a basis, it offers general recommendations for pension reform in India.

Stock Market Response to Union Budget

This paper explores the interplay between the Union Budget and the stock market in the following areas: the extent to which the stock market response to the Budget is consistent with the behaviour that we might expect in an efficient market; the role of the Budget in the Indian economy, using the stock market as an information processing tool; and the extent to which empirical research can guide hedging and trading around the Budget date.
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