Voting for insider trading regulation. An experimental study of informed and uninformed traders’ preferences
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22 août 2024
- ISIDORE Id: 10670/1.eccfc2...
- hal: hal-04692482
- doi: 10.1016/j.jbankfin.2024.107295
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info:eu-repo/semantics/altIdentifier/doi/10.1016/j.jbankfin.2024.107295
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Mots-clés
Experimental finance Asset market Insider trading regulation Vote/referendum Distributional preferences JEL classification: G10 G18 G40 Experimental finance Asset market Insider trading regulation C - Mathematical and Quantitative Methods/C.C9 - Design of Experiments/C.C9.C92 - Laboratory, Group Behavior D - Microeconomics/D.D8 - Information, Knowledge, and Uncertainty/D.D8.D82 - Asymmetric and Private Information • Mechanism Design G - Financial Economics/G.G1 - General Financial Markets/G.G1.G10 - General G - Financial Economics/G.G1 - General Financial Markets/G.G1.G18 - Government Policy and Regulation G - Financial EconomicsSujets proches
Insider information (Securities trading) Insider trading Inside information (Securities trading)Citer ce document
Dominik Schmidt et al., « Voting for insider trading regulation. An experimental study of informed and uninformed traders’ preferences », HAL SHS (Sciences de l’Homme et de la Société), ID : 10.1016/j.jbankfin.2024.107295
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Résumé
Capital markets often regulate insider trading, but whether such regulation aligns with traders’ preferences is an open question. This study examined traders’ regulation preferences conditional on their prospects of becoming informed. Of 64 referenda, traders decided 41 (64%) against regulation. Moreover, traders’ prospects of becoming informed significantly impacted the outcomes of the referenda. In markets in which a group of traders has no chance of receiving inside information, 47% of the referenda are decided against regulation. When all traders could get such information, 81% are. Individual votes reveal that traders who know they will remain uninformed support regulation in 69.27% of the cases, while informed traders do so only 8.33% of the time. Traders who may or may not become informed support regulation 33.33% of the time.
