Regulation, Trading Volume and Stock Market Volatility

J. Harold Mulherin

Revue Économique, 1990, vol. 41, issue 5, 923-938

Abstract: [fre] Régulation, Trading Volume and Stock Market Volatility. . Il est souvent avancé que la spéculation est la source d'une volatilité excessive des cours boursiers. Les autorités sont alors confrontées à un dilemme : renforcer la réglementation (par exemple en accroissant les coûts de transactions) réduit l'activité des opérateurs, ce qui va dans le bon sens, mais réduit la liquidité, ce qui est défavorable.. L'expérience américaine du XXè siècle semble montrer, que l'augmentation des coûts de transaction réduit bien leur volume mais que son effet sur la volatilité est ambigu. [eng] Regulation, trading volume and stock market volatility. . It is often argued that speculation causes an excess volatility of stock priees. The authorities then face a dilemma : more regulation (for instance increased transaction costs) reduces the activity of market intervenants, which goes in the right direction but reduces liquidity, which is unfavorable.. The US experience during the 20 th century shows that increases transaction costs reduce transaction volume but have an ambiguous effect on volatility.

Date: 1990
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