The optimal design of a market
type: Item
instance of: scholarly article
title: The optimal design of a market
zbMATH Open document ID: 0956.91039
author: Sandro Brusco
author: Matthew O. Jackson
published in: Journal of Economic Theory
publication date: 2001-03-09T00:00:00Z
review text: It is known that many organized markets such as the major world security exchanges limit the number of agents who may execute trade. A theoretical model where such limitation are optimal is presented in the article. A normative perspective on the design of a market and study the structure of the rules of trade that result in efficient allocations in a simple two-period model is taken into consideration. The results of investigations are summarized in four statements. The last one for example is: with uncertainty across periods, efficient mechanisms may involve multiple market makers, and the optimal number of market makers depends on the cost of trading, level of risk aversion, and presence of asymmetric information.
reviewed by: Sergei Georgievich Zhuravlev
Mathematics Subject Classification ID: 91B26
zbMATH DE Number: 1375343
zbMATH Keywords: market
zbMATH Keywords: rules of trade
zbMATH Keywords: optimal design of rules
MaRDI profile type: Publication
OpenAlex ID: W2028845761
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DOI: 10.1006/JETH.1999.2536
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description: scientific article; zbMATH DE number 1375343