The New Stock Market: Law, Economics, and Policy (Thu, 10 Dec, 12:30-1:30 PM)
Asian Institute of International Financial Law
Faculty of Law, The University of Hong Kong
The New Stock Market: Law, Economics, and Policy
Professor Merritt B. Fox
Michael E. Patterson Professor of Law, Columbia Law School
Thursday, 10 December 2020
12:30 – 1:30 PM
Academic Conference Room, 11/F Cheng Yu Tung Tower
The University of Hong Kong
The seminar presentation will serve as an introduction to The New Stock Market: Law, Economics, and Policy. The U.S. stock market has been transformed over the last twenty-five years. Once a market in which human beings traded at human speeds, it is now an electronic market pervaded by algorithmic trading, conducted at speeds nearing that of light. High-frequency traders participate in a large portion of all transactions, and a significant minority of all trade occurs on alternative trading systems known as “dark pools”. These developments have been widely criticized, but there is no consensus on the best regulatory response to these dramatic changes. The book offers a comprehensive new look at how these markets work, how they fail, and how they should be regulated. It draws on the informational paradigm of microstructure economics to highlight the crucial role of information asymmetries and adverse selection in explaining market behavior, while examining a wide variety of developments in market practices and participants. The result is an account of the stock market’s regulatory framework, fundamental institutions, and economic dynamics, combined with an assessment of its various controversies. The New Stock Market covers a wide range of issues including the practices of high-frequency traders, insider trading, manipulation, short selling, broker-dealer practices, and trading venue fees and rebates. The book illuminates both the existing regulatory structure of our equity trading markets and how we can improve it.
Merritt B. Fox is Michael E. Patterson Professor of Law at Columbia Law School, a Co-Director of the Center for Law and Economic Studies, and a Co-Director of the Program in the Law and Economics of Capital Markets. He is a graduate of Yale College and Yale Law School. He also received a Ph.D. in economics from Yale University. His academic interests are in the areas of corporate and securities law, law and economics, and international securities regulation and comparative corporate law. He practiced law with the New York City firm of Cleary, Gottlieb, Steen & Hamilton and taught at Yale University, Fordham Law School, and Indiana University Law School in Bloomington and the University of Michigan Law School, before joining the Columbia faculty in 2003.
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