The evolution of the rules and regulations of the first emerging markets: the London, New York and Paris stock exchanges, 1792-1914

Emerging stock markets present special problems for regulators, given that any stock exchange operates with a cooperative group of members whose collective interests at times may conflict with either the goals of investors or of corporations placing their securities on the market. Examining the distinct histories of the rules and regulations of the first emerging markets of the 19th century - London, New York, and Paris - we conclude that the rules established by the initial group of members in an exchange determine how it functions thereafter. Turning to recent experiences with stock exchanges in central and east Europe and in Asia, it appears that many of the lessons learned in the 19th century have been neglected in setting up the emerging markets of the 1990s.