This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

The Division of Markets is Limited by the Extent of Liquidity (Spatial Competition with Externalities)

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Economides, Nicholas
Siow, Aloysius

Additional information is available for the following registered author(s):

Abstract

Liquidity considerations will limit the number of markets in a competitive economy. Welfare implications are ambigious. Since liquidity is a positive externality, there may be too little liquidity per market at a noncooperative equilibrium and too many markets compared to the surplus-maximizing market structure. But liquidity is also self-reinforcing. Given an existing equilibrium, new markets may not open because nobody wants to use a new market with low liquidity. There may be too few markets to achieve efficiency. A nondiscriminating monopolist will operate smaller and more numerous markets compared to optimality as well as to the equilibrium of independent auctioneers. Copyright 1988 by American Economic Association.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help file. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://links.jstor.org/sici?sici=0002-8282%28198803%2978%3A1%3C108%3ATDOMIL%3E2.0.CO%3B2-V&origin=repec
File Format: application/pdf
File Function: full text
Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Publisher Info
Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 78 (1988)
Issue (Month): 1 (March)
Pages: 108-21
Download reference. The following formats are available: HTML, plain text, BibTeX, RIS (EndNote), ReDIF
Handle: RePEc:aea:aecrev:v:78:y:1988:i:1:p:108-21

Contact details of provider:
Email:
Web page: http://www.aeaweb.org/aer/
More information through EDIRC

Order Information:
Web: http://www.aeaweb.org/subscribe.html

For technical questions regarding this item, or to correct its listing, contact: (Christopher F. Baum).

Related research
Keywords:

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Munetomo Ando & Daisuke Oyama, 2002. "A model of a spatial economy with trading posts," Economics Bulletin, Economics Bulletin, vol. 18(1), pages 1-11. [Downloadable!]
  2. Malkamäki , Markku & Topi, Jukka, 1999. "Strategic Challenges for Exchanges and Securities Settlement," Research Discussion Papers 21/1999, Bank of Finland. [Downloadable!]
  3. Umberto Cherubini & Agnese Sironi, . "Bond Trading, Market Anomalies and Neural Networks: An Application with Kohonen Nets," Computing in Economics and Finance 1996 _012, Society for Computational Economics. [Downloadable!]
  4. Michael Roberts & Nigel Key, 2005. "Losing Under Contract: Transaction-Cost Externalities and Spot Market Disintegration," Journal of Agricultural & Food Industrial Organization, Berkeley Electronic Press, vol. 3(2), pages 1094-1094. [Downloadable!] (restricted)
  5. Iftekhar Hasan & Heiko Schmiedel, 2004. "Do networks in the stock exchange industry pay off? European evidence," International Finance 0405002, EconWPA. [Downloadable!]
  6. Marta Gomez Puig, 2005. "Monetary Integration and the Cost of Borrowing," Working Papers in Economics 134, Universitat de Barcelona. Espai de Recerca en Economia. [Downloadable!]
    Other versions:
  7. Estelle Cantillon & Pai-Ling Yin, 2007. "How and when do markets tip? Lessons from the Battle of the Bund," Working Paper Series 766, European Central Bank. [Downloadable!]
  8. Hasan, Iftekhar & Schmiedel , Heiko, 2003. "Do networks in the stock exchange industry pay off? European evidence," Research Discussion Papers 2/2003, Bank of Finland. [Downloadable!]
  9. Nicholas Economides & Jeff Heisler, . "Equilibrium Fee Schedules in a Monopolist Call Market," Financial Networks 94-15, Stern School of Bu, Economics of Networks. [Downloadable!]
    Other versions:
  10. Schmiedel, Heiko, 2002. "Total factor productivity growth in European stock exchanges: A non-parametric frontier approach," Research Discussion Papers 11/2002, Bank of Finland. [Downloadable!]
  11. Alexander K. Koch & Zdravetz Lazarov, 2005. "Clustering of Trading Activity in the DAX Index Options Market," Royal Holloway, University of London: Discussion Papers in Economics 05/02, Department of Economics, Royal Holloway University of London, revised Mar 2005. [Downloadable!]
    Other versions:
  12. Edward P. Lazear, 1995. "Culture and Language," NBER Working Papers 5249, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  13. Takanori Ago & Ikumo Isono & Takatoshi Tabuchi, 2003. "Locational Disadvantage and Losses from Trade: Three Regions in Economic Geography," CIRJE F-Series CIRJE-F-224, CIRJE, Faculty of Economics, University of Tokyo. [Downloadable!]
  14. Marta Gomez Puig, 2006. "The Impact of Monetary Union on EU-15 Sovereign Debt Yield Spreads," Working Papers in Economics 147, Universitat de Barcelona. Espai de Recerca en Economia. [Downloadable!]
    Other versions:
  15. Malkamäki, Markku, 1999. "Are there Economies of Scale in Stock Exchange Activities?," Research Discussion Papers 4/1999, Bank of Finland. [Downloadable!]
  16. Marta Gomez-Puig, 2007. "Eu-15 Sovereign Governments Cost Of Borrowing After Seven Years Of Monetary Union," IREA Working Papers 200711, University of Barcelona, Research Institute of Applied Economics, revised May 2007. [Downloadable!]
  17. Giles Duranton & Diego Puga, 2003. "Micro-Foundations of Urban Agglomeration Economies," NBER Working Papers 9931, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  18. Hideo Konishi, 1999. "Concentration of Competing Retail Stores," Boston College Working Papers in Economics 447, Boston College Department of Economics. [Downloadable!]
    Other versions:
Statistics
Access and download statistics

Did you know? You too can volunteer for RePEc, for example by encouraging others to register as authors.

This page was last updated on 2008-7-16.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.