search query: @author Fishman, M. / total: 3
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| Author: | DeMarzo, P. Fishman, M. Hagerty, K. |
| Title: | The optimal enforcement of insider trading regulations |
| Journal: | Journal of Political Economy
1998 : JUN, VOL. 106:3, p. 602-632 |
| Index terms: | INSIDER TRADING REGULATIONS ECONOMICS |
| Language: | eng |
| Abstract: | Regulating insider trading lessens the adverse selection problem facing market makers, enabling them to quote better prices. An optimal enforcement policy must balance these benefits against the costs of enforcement. Such a policy must specify (1) the conditions under which the regulator conducts an investigation, (2) the penalty schedule imposed if an insider is caught, and (3) a transaction tax to fun enforcement. The authors derive the policy that maximizes investors' welfare. |
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