Insider trading: regulation, securities markets, and welfare under risk aversion

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dc.contributor.author Estrada, Javier
dc.contributor.editor Universidad Carlos III de Madrid. Departamento de Economía
dc.date.accessioned 2009-04-07T10:11:17Z
dc.date.available 2009-04-07T10:11:17Z
dc.date.issued 1995-02
dc.identifier.issn 2340-5031
dc.identifier.uri http://hdl.handle.net/10016/3901
dc.description.abstract I analyze in this paper the impact of insider trading regulation (ITR) on a securities market and on social welfare. I argue below that the imposition of ITR forces a reallocation of wealth and risk that decreases social welfare. Three reasons explain this resulto First, ITR increases the volatility of securities prices, thus making the market more risky; second, it worsens the risk sharing among investors; and, third, it diverts resources from the productive sector of the economy. Further, although I formally establish conditions under which ITR makes society better off, largue that those conditions cannot be used to justify the imposition of this regulation.
dc.format.mimetype application/pdf
dc.language.iso eng
dc.relation.ispartofseries UC3M Working Paper. Economics;
dc.relation.ispartofseries 1995-09-05
dc.rights Atribución-NoComercial-SinDerivadas 3.0 España
dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.subject.other Insider trading
dc.subject.other Securities Regulation
dc.title Insider trading: regulation, securities markets, and welfare under risk aversion
dc.type workingPaper
dc.subject.eciencia Economía
dc.rights.accessRights openAccess
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