haku: @indexterm Insider trading / yhteensä: 155
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| Tekijä: | Buffa, A.M. Nicodano, G. |
| Otsikko: | Should insider trading be prohibited when share repurchases are allowed? |
| Lehti: | Review of finance
2008 : VOL. 12:4, p. 735-765 |
| Asiasana: | stocks shareholders incentives insider trading regulations information |
| Vapaa asiasana: | stockholders |
| Kieli: | eng |
| Tiivistelmä: | This paper sees share repurchases (henceforth as: reps.) as the way long-term shareholders preserving their ability to use corporate information (here as: corp-info.) for speculative purposes with insider trading (as: in-trdg.) regulation being enforced. The use of corp-info. increases the adverse selection losses of short-term shareholders. Thus, buy-back programs reduce their incentive to invest in stocks, leading to a socially inefficient equilibrium. Hence, in-trdg. should not be banned with allowing share reps. In general, it is argued that the regulation of in-trdg. and reps. cannot be considered in isolation. |
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