Event

Information Chasing versus Adverse Selection by Chaojun Wang

Microeconomics Research Seminar Series, Spring Term 2022

  • Mon 7 Mar 22

    16:00 - 17:30

  • Online

    Zoom

  • Event speaker

    Chaojun Wang

  • Event type

    Lectures, talks and seminars
    Microeconomics Research Seminar Series

  • Event organiser

    Economics, Department of

Join Chaojun Wang as they present research on Information Chasing versus Adverse Selection

Information Chasing versus Adverse Selection by Chaojun Wang

Join us for the another event in the Microeconomics Research Seminar Series, Spring Term 2022

Chaojun Wang, from Wharton School of the University of Pennsylvania, will present research on Information Chasing versus Adverse Selection. 

Abstract

Contrary to the prediction of the classic adverse selection theory, a more informed trader could receive better pricing relative to a less informed trader in over-the-counter financial markets. Dealers chase informed orders to better position their future quotes and avoid winner's curse in subsequent trades. When dealers are perfectly competitive and risk averse, their incentive of information chasing dominates their fear of adverse selection. In a more general setting, information chasing can dominate adverse selection when dealers face differentially informed speculators, while adverse selection dominates when dealers face differentially informed trades from a given speculator. These two seemingly contrasting predictions are supported by empirical evidence from the UK government bond market. 

This seminar will be held at 4pm on Zoom. This event is open to all levels of study and is also open to the public. To register your place and gain access to the webinar, please contact the seminar organisers.

This event is part of the Microeconomics Research Seminar Series.

 

A lady handling money
Contact the seminar organisers
Dr Ahrash Dianat Department of Economics
University of Essex
Dr Aditya Kuvalekar Department of Economics
University of Essex

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