RT Journal Article
T1 Who acquires information in dealer markets?
A1 Rüdiger Sorensen, Jesper
A1 Vigier, Adrien
AB We study information acquisition in dealer markets. We first identifya one-sided strategic complementarity in information acquisition:the more informed traders are, the larger market makers’ gain frombecoming informed. When quotes are observable, this effect in turninduces a strategic complementarity in information acquisitionamongst market makers. We then derive the equilibrium pattern ofinformation acquisition and examine the implications of our analysisfor market liquidity and price discovery. We show that increasing thecost of information can decrease market liquidity and improve pricediscovery.
PB American Economic Association
SN 0002-8282
YR 2020
FD 2020-04-01
LK http://hdl.handle.net/10016/34583
UL http://hdl.handle.net/10016/34583
LA eng
DS e-Archivo
RD 28 abr. 2024