Tag Archives: Financial Markets

The High-Frequency Trading Arms Race: Frequent Batch Auctions as a Market Design Response

From Eric Budish, Peter Cramton, and John Shim: We argue that the continuous limit order book is a flawed market design and propose that financial exchanges instead use frequent batch auctions: uniform-price sealed-bid double auctions conducted at frequent but discrete time … Continue reading

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A Model of the Safe Asset Mechanism (SAM): Safety Traps and Economic Policy

From Caballero and Fahri: The global economy has a chronic shortage of safe assets which lies behind many recent macroeconomic imbalances. This paper provides a simple model of the Safe Asset Mechanism (SAM), its recessionary safety traps, and its policy … Continue reading

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