EconPapers    
Economics at your fingertips  
 

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) Downloads
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 ().

 
Page updated 2025-03-19
Handle: RePEc:aea:aecrev:v:114:y:2024:i:8:p:2388-2435