An information transaction entails the purchase of information. Formally, it consists of an information structure … together with a price. We develop an index of the appeal of information transactions, which is derived as a dual to the agent …'s preferences for information. The index of information transactions has a simple analytic characterization in terms of the relative …

role as market makers they face inventory and asymmetric information costs. Consistent with this, we find that while market … indicates that market makers derive an information benefit from direct interaction with traders especially when risk and … information asymmetry is high. Except for very small trades, explicit transaction costs of non-dealer customers are lower when …