This setting lets you change the way you view articles. You can choose to have articles open in a dialog window, a new tab, or directly in the same window.
Open in Dialog
Open in New Tab
Open in same window

American Economic Review: Vol. 101 No. 4 (June 2011)

Expand

Quick Tools:

Print Article Summary
Export Citation
Sign up for Email Alerts Follow us on Twitter

Explore:

AER - All Issues

AER Forthcoming Articles

The Role of Trading Frictions in Real Asset Markets

Article Citation

Gavazza, Alessandro. 2011. "The Role of Trading Frictions in Real Asset Markets." American Economic Review, 101(4): 1106-43.

DOI: 10.1257/aer.101.4.1106

Abstract

This paper investigates how trading frictions vary with the thickness of the asset market by examining patterns of asset allocations and prices in commercial aircraft markets. The empirical analysis indicates that assets with a thinner market are less liquid — i.e., more difficult to sell. Thus, firms hold on longer to them amid profitability shocks. Hence, when markets for assets are thin, firms' average productivity and capacity utilization are lower, and the dispersions of productivity and of capacity utilization are higher. In turn, prices of assets with a thin market are lower and have a higher dispersion. (JEL A12, L11, L93)

Article Full-Text Access

Full-text Article

Additional Materials

Download Data Set (27.13 MB) | Online Appendix (137.08 KB)

Authors

Gavazza, Alessandro (NYU)

JEL Classifications

A12: Relation of Economics to Other Disciplines
L11: Production, Pricing, and Market Structure; Size Distribution of Firms
L93: Air Transportation


American Economic Review


Quick Tools:

Sign up for Email Alerts

Follow us on Twitter

Subscription Information
(Institutional Administrator Access)

Explore:

AER - All Issues

AER - Forthcoming Articles

Virtual Field Journals


AEA Member Login:


AEAweb | AEA Journals | Contact Us