Enforcement Problems and Secondary Markets
Abstract
There is a large and growing literature that studies the effects of weak enforcement institutions on economic performance. This literature has focused almost exclusively on primary markets, in which assets are issued and traded to improve the allocation of investment and consumption. The general conclusion is that weak enforcement institutions impair the workings of these markets, giving rise to various inefficiencies. But weak enforcement institutions also create incentives to develop secondary markets, in which the assets issued in primary markets are retraded. This paper shows that trading in secondary markets counteracts the effects of weak enforcement institutions and, in the absence of further frictions, restores efficiency.Download Info
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 13559.Length:
Date of creation: Oct 2007
Date of revision:
Handle: RePEc:nbr:nberwo:13559
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Keywords:Other versions of this item:
- Fernando A. Broner & Alberto Martin & Jaume Ventura, 2008. "Enforcement Problems and Secondary Markets," Journal of the European Economic Association, MIT Press, vol. 6(2-3), pages 683-694, 04-05.
- Fernando Broner & Alberto Martin & Jaume Ventura, 2007. "Enforcement problems and secondary markets," Economics Working Papers 1049, Department of Economics and Business, Universitat Pompeu Fabra.
- Broner, Fernando A & Martin, Alberto & Ventura, Jaume, 2007. "Enforcement Problems and Secondary Markets," CEPR Discussion Papers 6498, C.E.P.R. Discussion Papers.
- F34 - International Economics - - International Finance - - - International Lending and Debt Problems
- F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
- G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-11-03 (All new papers)
- NEP-URE-2007-11-03 (Urban & Real Estate Economics)
References
References listed on IDEASPlease 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.:
- Fernando Broner & Alberto Martin & Jaume Ventura, 2006.
"Sovereign Risk and Secondary Markets,"
NBER Working Papers
12783, National Bureau of Economic Research, Inc.
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Aitor Erce, 2012. "Selective sovereign defaults," Globalization and Monetary Policy Institute Working Paper 127, Federal Reserve Bank of Dallas.
- Fernando A. Broner & Jaume Ventura, 2010.
"Rethinking the Effects of Financial Liberalization,"
NBER Working Papers
16640, National Bureau of Economic Research, Inc.
- Jaume Ventura & Fernando Broner, 2008. "Rethinking the effects of financial liberalization," 2008 Meeting Papers 747, Society for Economic Dynamics.
- Fernando Broner & Jaume Ventura, 2010. "Rethinking the effects of financial liberalization," Economics Working Papers 1128, Department of Economics and Business, Universitat Pompeu Fabra, revised Dec 2010.
- Fernando Broner & Jaume Ventura, 2010. "Rethinking the Effects of Financial Liberalization," Working Papers 509, Barcelona Graduate School of Economics.
- Broner, Fernando A & Ventura, Jaume, 2010. "Rethinking the Effects of Financial Liberalization," CEPR Discussion Papers 8171, C.E.P.R. Discussion Papers.
- Viral V. Acharya & Itamar Drechsler & Philipp Schnabl, 2011.
"A Pyrrhic Victory? - Bank Bailouts and Sovereign Credit Risk,"
NBER Working Papers
17136, National Bureau of Economic Research, Inc.
- Acharya, Viral V & Drechsler, Itamar & Schnabl, Philipp, 2011. "A Pyrrhic Victory? Bank Bailouts and Sovereign Credit Risk," CEPR Discussion Papers 8679, C.E.P.R. Discussion Papers.
- Aitor Erce Domiguez, 2010. "Debtor Discrimination During Sovereign Debt Restructurings," 2010 Meeting Papers 1324, Society for Economic Dynamics.
- Yeyati, Eduardo Levy & Schmukler, Sergio L. & Van Horen, Neeltje, 2007.
"Emerging market liquidity and crises,"
Policy Research Working Paper Series
4445, The World Bank.
- Eduardo Levy Yeyati & Sergio L. Schmukler & Neeltje Van Horen, 2008. "Emerging Market Liquidity and Crises," Journal of the European Economic Association, MIT Press, vol. 6(2-3), pages 668-682, 04-05.
- Guembel, Alexander & Sussman, Oren, 2009.
"Sovereign Debt without Default Penalties,"
Open Access publications from University of Toulouse 1 Capitole
http://neeo.univ-tlse1.fr, University of Toulouse 1 Capitole.
- Oren Sussman & Alexander Guembel, 2005. "Sovereign Debt Without Default Penalties," OFRC Working Papers Series 2005fe17, Oxford Financial Research Centre.
- Raddatz, Claudio & Schmukler, Sergio L., 2008.
"Pension Funds And Capital Market Development:How Much Bang For The Buck?,"
Policy Research Working Paper Series
4787, The World Bank.
- Claudio Raddatz & Sergio Schmukler, 2010. "Pension Funds And Capital Market Development: How Much Bang For The Buck?," Working Papers 38, Superintendencia de Pensiones, revised Feb 2010.
- Miguel Palomino Bonilla & Rudy Wong Barrantes, 2011. "Housing Finance in Peru: What is Holding it Back?," Research Department Publications 4748, Inter-American Development Bank, Research Department.
- Mario Cuevas & Sigfrido Lee & Maria Isabel Bonilla, 2011. "The Missing Foundations of Housing Finance: Incomplete Markets, Fragmented Policies and Emerging Solutions in Guatemala," Research Department Publications 4750, Inter-American Development Bank, Research Department.
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