Competition between securities markets: stock exchange industry regulation in the Paris financial center at the turn of the twentieth century

Pierre Hautcoeur, Amir Rezaee and Angelo Riva ()
Additional contact information
Amir Rezaee: ISG Business School
Angelo Riva: European Business School/OMNES Research Center

Cliometrica, 2023, vol. 17, issue 2, No 3, 299 pages

Abstract: Abstract We study two regulatory changes that affected competition between the transparent Parquet and the OTC-like Coulisse markets in Paris at the turn of the twentieth century. The two reforms determined three regimes of competition—illegal competition, free competition, and enforced monopoly. After documenting institutional changes and their political economy, we show that the Paris market touch (i.e., the average spread of securities traded in the two markets) widened under the free competition regime but narrowed under the enforced monopoly regime to a size much smaller than during the first. These results accord with recent literature that questions the effects of competition between transparent and opaque markets; a transparent monopoly might be more effective than competition if the latter involves opaque markets.

Keywords: Paris stock exchange; Market microstructures; Regulation; Monopoly; Consolidation; Fragmentation; Spreads (search for similar items in EconPapers)
JEL-codes: G14 G18 G24 N13 N23 N43 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (2)

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Working Paper: Competition between securities markets: stock exchange industry regulation in the Paris financial center at the turn of the twentieth century (2023)
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DOI: 10.1007/s11698-022-00248-7

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