Arbeitspapier
Designated Market Makers: Competition and Incentives
Do competition and incentives offered to designated market makers (DMMs) improve market liquidity? Using data from the NYSE Euronext Paris, we show that an exogenous increase in competition among DMMs leads to a significant decrease in quoted and effective spreads, mainly through a reduction in the realized spread. In contrast, changes in incentives, through small changes in rebates and requirements for DMMs, do not have any tangible effect on market liquidity. Our analysis shows that incentivizing DMMs might not necessary lead to an improvement of market liquidity unless exchanges induce greater competition among DMMs.
- Sprache
-
Englisch
- Erschienen in
-
Series: SAFE Working Paper ; No. 247
- Klassifikation
-
Wirtschaft
Asset Pricing; Trading Volume; Bond Interest Rates
Information and Market Efficiency; Event Studies; Insider Trading
- Thema
-
Designated Market Makers
DMMs
Liquidity Provision
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Bellia, Mario
Pelizzon, Loriana
Subrahmanyam, Marti G.
Yuferova, Darya
- Ereignis
-
Veröffentlichung
- (wer)
-
Leibniz Institute for Financial Research SAFE
- (wo)
-
Frankfurt a. M.
- (wann)
-
2020
- DOI
-
doi:10.2139/ssrn.3354400
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:43 MEZ
Datenpartner
Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Bellia, Mario
- Pelizzon, Loriana
- Subrahmanyam, Marti G.
- Yuferova, Darya
- Leibniz Institute for Financial Research SAFE
Entstanden
- 2020
Ähnliche Objekte (12)
Market competition and lower tier incentives
Managerial incentives, innovation and product market competition
Product Market Competition, Incentives and Fraudulent Behavior
Competition and Incentives
Automated Market Makers
Emerging competition and risk-taking incentives at Fannie Mae and Freddie Mac
Yardstick competition, corruption, and electoral incentives
How does market competition affect firm innovation incentives in emerging countries? Evidence from Chile and Colombia
Trading system competition and market-maker competition
Common Ownership, Competition, and Top Management Incentives
Innovation, competition and incentives for R&D
Fiscal incentives, competition, and investment in China
Market competition and lower tier incentives
Managerial incentives, innovation and product market competition
Product Market Competition, Incentives and Fraudulent Behavior
Competition and Incentives
Automated Market Makers
Emerging competition and risk-taking incentives at Fannie Mae and Freddie Mac
Yardstick competition, corruption, and electoral incentives
How does market competition affect firm innovation incentives in emerging countries? Evidence from Chile and Colombia
Trading system competition and market-maker competition
Common Ownership, Competition, and Top Management Incentives
Innovation, competition and incentives for R&D
Fiscal incentives, competition, and investment in China
Market competition and lower tier incentives
Managerial incentives, innovation and product market competition
Product Market Competition, Incentives and Fraudulent Behavior
Competition and Incentives
Automated Market Makers
Emerging competition and risk-taking incentives at Fannie Mae and Freddie Mac
Yardstick competition, corruption, and electoral incentives
How does market competition affect firm innovation incentives in emerging countries? Evidence from Chile and Colombia
Trading system competition and market-maker competition
Common Ownership, Competition, and Top Management Incentives
Innovation, competition and incentives for R&D