International cross-listing and order flow migration: evidence from an emerging market

Article Abstract:

Policymakers in emerging markets are increasingly concerned about the consequences for the domestic equity market when companies list stock abroad. We show that the effects of cross-listing depend on the quality of intermarket information linkages. We investigate these issues with unique data from the Mexican equity market. The impact of cross-listing is complex - balancing the costs of order flow migration against the benefits of increased intermarket competition. These effects are exacerbated by equity investment barriers that induce segmentation of the domestic equity market. Consequently, the benefits and costs of cross-listing are not evenly spread over all classes of shareholders. (Reprinted by permission of the publisher.)

International aspects, Stock-exchange, Stock exchanges, Developing countries, Securities

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Competition and collusion in dealer markets

Article Abstract:

This article develops a game-theoretic model to analyze market markets' intertemporal pricing strategies. We show that dealers who adopt noncooperative pricing strategies may set bid-ask spread above competitive levels. This form of "implicit collusion" differs from explicit collusion, where dealers cooperate to fix prices. Price discreteness or asymmetric information are not required for collusion to occur. Rather, institutional arrangements that restrict access to the order flow are important determinants of the ability to collude because they reduce dealers' incentives to compete on price. Public policy efforts to increase interdealer competition should focus on such restrictions. (Reprinted by permission of the publisher.)

Analysis, Competition (Economics), Pricing, Price fixing, Market makers (Securities trading)

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Determinants of the consumer bankruptcy decision

Article Abstract:

Qualitative choice models of consumer bankruptcy in the US indicate that the most significant factors in consumer bankruptcy are medical and credit card debt. Homeownership plays a significant role in discouraging bankruptcy. It seems likely that further rises in health insurance coverage could limit bankruptcy filings. When a bankruptcy decision has been made, such reforms are anticipated to boost debt repayment through Chapter 13. There is evidence that debates about over-extended credit card loans should concentrate on the impact of pre-approved credit cards.

Research, Bankruptcy

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