Affiliation:
1. School of Economics Shandong University Jinan China
2. College of Business and Economics Australian National University Canberra Australia
Abstract
AbstractUsing data on city‐level daily traffic congestion and stock block trading, we investigate the impact of trader cities' traffic congestion on the stock block trading price. We find that higher level of traffic congestion in the traders' cities is associated with lower stock block trading premium, particularly when the information asymmetry between the trading parties is high. We also find that the buyers have more bargaining power in determining the price premium of block trading. Moreover, we employ a multi‐pronged approach to address the identification issue and find confirming evidence for the causal link.
Funder
National Natural Science Foundation of China
Natural Science Foundation of Shandong Province
Subject
Economics and Econometrics,Finance