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We study the efficiency of liquidity provision by dealers and the desirability of policy intervention in over-the-counter (OTC) markets during crises. We emphasizes two OTC frictions: finding counterparties takes time, and trade is bilateral and involves bargaining. We model a crisis as a shock...
Persistent link: https://www.econbiz.de/10011042999
We study the efficiency of dealers' liquidity provision and the desirability of policy intervention in over-the-counter (OTC) markets during crises. Our theory emphasizes two key frictions in OTC markets: finding counterparties takes time, and trade is bilateral, with quantities and prices...
Persistent link: https://www.econbiz.de/10013150744
Persistent link: https://www.econbiz.de/10009514551
"We study the dynamics of liquidity provision by dealers during an asset market crash, described as a temporary negative shock to investors' aggregate asset demand. We consider a class of dynamic market settings where dealers can trade continuously with each other, while trading between dealers...
Persistent link: https://www.econbiz.de/10003563860
Persistent link: https://www.econbiz.de/10003735719
Persistent link: https://www.econbiz.de/10011863629
We study the efficiency of dealers' liquidity provision and the desirability of policy intervention in over-the-counter (OTC) markets during crises. Our theory emphasizes two key frictions in OTC markets: finding counterparties takes time, and trade is bilateral, with quantities and prices...
Persistent link: https://www.econbiz.de/10012463235
We study the dynamics of liquidity provision by dealers during an asset market crash, described as a temporary negative shock to investors aggregate asset demand. We consider a class of dynamic market settings where dealers can trade continuously with each other, while trading between dealers...
Persistent link: https://www.econbiz.de/10012464526
Persistent link: https://www.econbiz.de/10009349267
Persistent link: https://www.econbiz.de/10009009883