Camargo, Braz
[VerfasserIn]
;
Kim, Kyungmin
[Sonstige Person, Familie und Körperschaft];
Lester, Benjamin R.
[Sonstige Person, Familie und Körperschaft]
Information Spillovers, Gains from Trade, and Interventions in Frozen Markets
Erschienen in:FRB of Philadelphia Working Paper ; No. 16-28
Umfang:
1 Online-Ressource (65 p)
Sprache:
Englisch
Entstehung:
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments 2016-11-03 erstellt
Beschreibung:
We study government interventions in markets suffering from adverse selection. Importantly, asymmetric information prevents both the realization of gains from trade and the production of information that is valuable to other market participants. We find a fundamental tension in maximizing welfare: While some intervention is required to restore trading, too much intervention depletes trade of its informational content. We characterize the optimal policy that balances these two considerations and explore how it depends on features of the environment. Our model can be used to study a program introduced in 2009 to restore information production in the market for legacy assets