• 00:00    |    
    Initial credits
  • 00:06    |    
    Introduction by Luis Figueroa
  • 00:14    |    
    What is insider trading? Is it a good or a bad practice?
  • Insider trading definition
  • 01:55    |    
    Alexandre Padilla's investigation on insider trading
    • Galleon case
    • Effects of insider trading on free markets
    • Local knowledge
    • Effects of insider trading regulations
    • Corporate scandals
  • 05:38    |    
    Have you received feedback from regulators about your ideas?
    • Henry Manne's perspective
    • Regulator's view on insider trading
    • Egalitarian view of what the stock market should be
    • Importance of knowledge to invest in the stock market
  • 08:33    |    
    Final words
  • 09:24    |    
    Final credits

Insider Trading: Does It Help or Hamper the Markets?

New Media  | 10 de febrero de 2012  | Vistas: 17

Alexandre Padilla looks at whether insider trading is good or bad. He defines insider trading as the use of nonpublic information in a securities transaction and goes on to explain that even when secret information is not disclosed, the actions of investors who have more knowledge about a company signal other participants in the market to either buy or sell stock in that company.

Through his research, Padilla is trying to determine whether allowing insider trading would help or hamper free markets. He draws a parallel between Hayek’s view of the importance of local knowledge in the allocation of scarce resources and the impact on capital markets of investors acting with insider knowledge.

Finally, Padilla discusses insider trading regulation and the idea that stock markets should be a level playing field where anyone can get rich. He explains that this egalitarian view is not realistic because not all investors will have the same knowledge or the time required to make good investments.


Alexandre Padilla is associate professor of economics at Metropolitan State College…