Preferencing, Internalization, Best Execution, and Dealer Profits
研究伦敦证券交易所股票中优先交易和内部化对价差及做市商利润的影响，发现优先交易虽提高价差但未增加利润，内部化反而降低价差，结果不支持合谋假说，而支持高成本搜索与交易关系假说。
The practices of preferencing and internalization have been alleged to support collusion, cause worse execution, and lead to wider spreads in dealership style markets relative to auction style markets. For a sample of London Stock Exchange stocks, we find that preferenced trades pay higher spreads, however they do not generate higher dealer profits. Internalized trades pay lower, not higher, spreads. We do not find a relation between the extent of preferencing or internalization and spreads across stocks. These results do not lend support to the “collusion” hypothesis but are consistent with a “costly search and trading relationships” hypothesis.