Calcagno, Riccardo; Lovo, Stefano - In: Review of Economic Studies 73 (2006) 2, pp. 329-355
This paper studies the effect of asymmetric information on the price formation process in a quote-driven market. One market-maker receives private information on the value of the quoted asset and repeatedly competes with market-makers who are uninformed. We show that despite the fact that the...
