01831cas a2200277 a 4500 AALejournalIMF019154 230101c9999 xx r poo 0 0eng d 5.00 USD 9781498303774 1018-5941 BD-DhAAL BD-DhAAL Hau, Harald. Discriminatory Pricing of Over-the-Counter Derivatives / Harald Hau, Peter Hoffmann, Sam Langfield, Yannick Timmer. Washington, D.C. : International Monetary Fund, 2019. 1 online resource (45 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students New regulatory data reveal extensive price discrimination against non-financial clients in the FX derivatives market. The client at the 90th percentile pays an effective spread of 0.5%, while the bottom quarter incur transaction costs of less than 0.02%. Consistent with models of search frictions in over-the-counter markets, dealers charge higher spreads to less sophisticated clients. However, price discrimination is eliminated when clients trade through multi-dealer request-for-quote platforms. We also document that dealers extract rents from captive clients and market opacity, but only for contracts negotiated bilaterally with unsophisticated clients. Mode of access: Internet Hoffmann, Peter. Langfield, Sam. Timmer, Yannick. IMF Working Papers; Working Paper ; No. 2019/100 Full text available on IMF http://elibrary.imf.org/view/journals/001/2019/100/001.2019.issue-100-en.xml IMF e-Library