Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/237981 
Year of Publication: 
2020
Series/Report no.: 
BGPE Discussion Paper No. 190
Publisher: 
Friedrich-Alexander-Universität Erlangen-Nürnberg, Erlangen und Nürnberg
Abstract: 
This paper investigates the implications of the Grossman-Stiglitz (1980) model on the informational efficiency of financial markets for the optimality of the allocation of talent to financial trading versus entrepreneurship. Informed traders make the financial market more informationally efficient, entrepreneurs create output and jobs. The model indicates that financial trading attracts too much, rather than too little, talent.
Subjects: 
market efficiency
asymmetric information
allocation of talent
occupational choice
JEL: 
G14
J24
Document Type: 
Working Paper

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