Abstract

Stock exchanges are the marketplaces for trading equity instruments and provide one of the most important ways for firms to raise money. By selling company shares in stock exchanges, firms can raise financial capital for further expansion. Investors can easily buy or sell stocks in the stock markets. In addition, stock markets provide divestment opportunities for venture capital and private equity investments, which is critical for the cultivation of high-tech industries. The proper interactions between stock exchanges and venture capital markets are crucial to the booming of high-tech industries in the United States (Zook, 2002). Thus, a stock market that operates well is of great value to economic development.