00000nam 2200000zi 4500 9.903151 CaOODSP 20240829103637 m o d f cr mn||||||||| 210908t20212021onca ob f000 0 eng d CaOODSP eng rda CaOODSP n-cn--- FB3-5/2021-39E-PDF Allen, Jason, author. Centralizing over-the-counter markets? / by Jason Allen and Milena Wittwer. Ottawa, Ontario : Bank of Canada = Banque du Canada, 2021. ©2021 1 online resource (ii, 44, 24 pages) : illustrations (some colour). text txt rdacontent computer c rdamedia online resource cr rdacarrier Staff working paper = Document de travail du personnel, 1701-9397 ; 2021-39 "Last updated: August 10, 2021." Includes bibliographical references (pages 40-44). "In traditional over-the-counter (OTC) markets, investors trade bilaterally through intermediaries referred to as dealers. An important regulatory question is whether to centralize OTC markets by shifting trades onto centralized platforms. We address this question in the context of the liquid Canadian government bond market. We document that dealers charge markups even in this market and show that there is a price gap between large investors who have access to a centralized platform and small investors who do not. We specify a model to quantify how much of this price gap is due to platform access and assess welfare effects. The model predicts that not all investors would use the platform even if platform access were universal. Nevertheless, the price gap would close by 32%–47%. Welfare would increase by 9%–30% because more trades are conducted by dealers who have high values to trade"--Abstract, page ii. Over-the-counter markets Canada Econometric models. Government securities Prices Canada Econometric models. Marchés hors bourse Canada Modèles économétriques. Effets publics Prix Canada Modèles économétriques. Bank of Canada, issuing body. Staff working paper (Bank of Canada) 2021-39. (CaOODSP)9.806221 PDF 1.39 MB https://publications.gc.ca/collections/collection_2021/banque-bank-canada/FB3-5-2021-39-eng.pdf