| This dissertation uses law and economics as a tool for designing optimal legal arrangements. The basic premise of law and economics is that existing legal arrangements are imperfect and costly and that any choice must therefore be guided by a careful evaluation of their efficiency attributes. In law and economics, efficiency evaluation is based upon a comparison of the cost-benefit profile of each alternative, with the final choice being made in favor of the arrangement that maximizes the sum of transaction gains, transaction costs and losses.; This dissertation explores and applies the methodological insights of law and economics to the field of securities regulation, and, in particular, to market regulation in Cote d'Ivoire. Ideally, securities regulation seeks to ensure that investors are provided with the most reliable information in an environment where fraudulent activities are minimized. When these rationales are fulfilled, a securities market is likely to perform efficiently by inducing the allocation of resources to their highest valued use. Yet, ensuring efficient allocation of resources entails costs. Only when net gains from regulation are maximized is such an endeavor worthwhile.; The main finding of the research is that if the Ivorian law is improved to incorporate proper auditing standards, appropriate disclosure of new material events, and adequate liability rules, public confidence in the market will increase, which, in turn will result in higher levels of investments. However, the efficacy of the judiciary system, the capability of market authorities for strong enforcement of the law, and investor education determine the full realization of these benefits. |
