The Law and Economics of Insider Trading

Sensenbrenner, Frank; Ryznar, Margaret

doi:10.2139/ssrn.2604013

The Law and Economics of Insider Trading

Wake Forest Law Review, Vol. 50, No. 5, pp. 1155-1179, 2015

26 Pages Posted: 9 May 2015 Last revised: 28 Feb 2016

See all articles by Frank Sensenbrenner

Frank Sensenbrenner

Johns Hopkins University - Paul H. Nitze School of Advanced International Studies (SAIS)

Margaret Ryznar

Indiana University Robert H. McKinney School of Law

Date Written: May 8, 2015

Abstract

Several recent high-profile insider trading losses have not stopped the federal government from aggressively prosecuting insider trading cases. The first of its kind, this law review article offers both a legal analysis and an empirical analysis that would aid the government in detecting and prosecuting insider trading. Specifically, this article finds that insider traders move prices more than non-insider trades of similar characteristics and insiders trade on high-volume days based on a dataset generated from SEC litigation releases.

Keywords: insider trading, white collar crime, SEC, law and economics, criminal law

Suggested Citation: Suggested Citation

Sensenbrenner, Frank and Ryznar, Margaret, The Law and Economics of Insider Trading (May 8, 2015). Wake Forest Law Review, Vol. 50, No. 5, pp. 1155-1179, 2015. Available at SSRN: https://ssrn.com/abstract=2604013 or http://dx.doi.org/10.2139/ssrn.2604013