Repeated Trading: Transparency and Market Structure
Ayça Kaya and
Santanu Roy
American Economic Review, 2024, vol. 114, issue 8, 2388-2435
Abstract:
We analyze the effect of transparency of past trading volumes in markets where an informed long-lived seller can repeatedly trade with short-lived uninformed buyers. Transparency allows buyers to observe previously sold quantities. In markets with intraperiod monopsony (single buyer each period), transparency reduces welfare if the ex ante expected quality is low but improves welfare if the expected quality is high. The effect is reversed in markets with intraperiod competition (multiple buyers each period). This discrepancy in the efficiency implications of transparency is explained by how buyer competition affects the seller's ability to capture rents, which, in turn, influences market screening.
JEL-codes: D40 D82 D83 G14 L15 (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:
Downloads: (external link)
https://www.aeaweb.org/doi/10.1257/aer.20230114 (application/pdf)
https://www.aeaweb.org/doi/10.1257/aer.20230114.appx (application/pdf)
https://www.aeaweb.org/doi/10.1257/aer.20230114.ds (application/zip)
Access to full text is restricted to AEA members and institutional subscribers.
Related works:
Working Paper: Repeated Trading: Transparency and Market Structure (2023) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:aea:aecrev:v:114:y:2024:i:8:p:2388-2435
Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions
DOI: 10.1257/aer.20230114
Access Statistics for this article
American Economic Review is currently edited by Esther Duflo
More articles in American Economic Review from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().