Competition Among the Exchanges Before the Sec: Was the NYSE a Natural Hegemon?

35 Pages Posted: 18 Jan 2013 Last revised: 19 Aug 2021

See all articles by Eugene N. White

Eugene N. White

Rutgers, The State University of New Jersey

Date Written: January 2013

Abstract

Improved information technology and higher volume should drive orders to be concentrated in one market, lowering the costs of transactions. However, the opposite occurred during the bull market of the 1920s when rapid technological change spawned a flood of new issues. This paper employs newly recovered data for 1900-1933 on the volume and seat prices of regional exchanges to examine how these rivals successfully competed with the NYSE, leading to its relative decline at the zenith of the market. The history of U.S. exchanges reveals that the tendency towards concentration of trading is periodically reversed when new industries, whose technologies are risky and unfamiliar, are more easily accommodated by existing or new rivals to the dominant exchange

Suggested Citation

White, Eugene N., Competition Among the Exchanges Before the Sec: Was the NYSE a Natural Hegemon? (January 2013). NBER Working Paper No. w18712, Available at SSRN: https://ssrn.com/abstract=2202650

Eugene N. White (Contact Author)

Rutgers, The State University of New Jersey ( email )

311 North 5th Street
New Brunswick, NJ 08854
United States

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