<p class="MsoBodyText2" style="margin: 0in 34.2pt 0pt 0.5in;"><span style="font-size: 10pt;"><span style="font-family: Times New Roman;">This paper examines the empirical association between stock market development and economic growth for a period of ten years around the Indian market &ldquo;liberalization&rdquo; event.<span style="mso-spacerun: yes;">&nbsp; </span>We find no support for the hypothesis that the Indian stock market development is associated with the economic growth in that country during the entire event study period of 1981 to 2001.<span style="mso-spacerun: yes;">&nbsp; </span>We find support for relevance of stock market to econmic development during the pre-liberalization sub-period.<span style="mso-spacerun: yes;">&nbsp; </span>We also find a negative correlation between stock market development and economic growth for the post-liberalization period.<span style="mso-spacerun: yes;">&nbsp; </span>We offer a number of hypotheses consistent with the inverse relationship between growth and stock market development in the post-liberalization period.<span style="mso-spacerun: yes;">&nbsp; </span>In particular, our results are consistent with the suggestion that the Indian Stock market is a casino for the sub-period of<span style="mso-spacerun: yes;">&nbsp; </span>post liberalization and for the entire ten-year event study period.</span></span></p>

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