Indexation of wages and salaries as well as of financial assets is a prominent theme in the present discussion on employment and inflation policies in Belgium. Recently, Kervyn and Staes (1975) have analyzed the first question; in this paper we analyze the second.
So far, most contributions to this subject have been theoretical in nature (see Steinherr and Vila (1974), and the literature cited there). The question how indexation might affect demand and supply in financial markets has not been analyzed empirically with any rigor. The main purpose of this paper is to fill this gap partly.