Investment and Insider Trading
研究内幕交易如何影响投资者的项目选择，发现当投资对信息弹性足够大时，内幕交易可通过提高价格信息含量来改善福利，并减少无信息者被剥削的频率。
We study insider trading in a dynamic setting. \nRational but uninformed, traders choose between \ninvestment projects with different levels \nof insider trading. Insider trading distorts investment \ntoward assets with less private information. \nHowever, when investment is sufficiently \ninformation elastic, insider trading can \nbe welfare-enhancing because of more informative \nprices. When insiders repeatedly receive information, \nthey trade to reveal it when investment \nis information elastic because good news \nincreases investment and hence future insider \nprofits. Thus, more information is revealed and \nuninformed agents are exploited lessfrequently \nby insiders. Both effects are Pareto-improving. \nFinally, we consider various insider-trading regulations.