Flow Trading

We thank Elizabeth Baldwin, Thomas Ernst, Brett Green, Paul Klemperer, Paul Milgrom, David Parkes, Marzena Rostek, and Chester Spatt for helpful conversations. We thank seminar audiences at the ASSA AEA meeting, NBER Market Design Working Group Meeting, Bocconi University, University of Michigan, Washington University St. Louis, SFS Cavalcade, Microstructure Exchange, Korea University, KAIST, University of Maryland, Georgetown University, Federal Reserve Board, University of College London and New York University for valuable feedback. Disclosures: Budish is an advisor to a project pursuing frequent batch auctions for decentralized finance. Cramton consults on market design and was an academic advisor to Carta on the design of a private equity exchange. Kyle has worked as a consultant for various U.S. government agencies on issues related to competition and efficiency in financial markets. He is a non-executive director of a U.S.-based asset management company. The authors have no other relevant or material financial interests that relate to this research. Research support: Budish thanks the University of Chicago Booth School of Business. Cramton thanks the German Research Foundation (DFG, EXC 2126/1-390838866) and the European Research Council under the European Union’s research and innovation program (grant 741409). The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.