Abstract We study risk-sharing economies where heterogeneous agents trade subject to quadratic transaction costs. The corresponding equilibrium asset prices and trading strategies are characterised by a system of nonlinear, fully coupled forward–backward stochastic differential equations. show that unique solution exists provided the agents’ preferences sufficiently similar. In benchmark specif...

The theory of transaction costs is the basic analytical tool of the new institutional economics. However, there is a lot of argument over whether transaction costs can be measured, as well as how to measure transaction costs. This paper aims to build accounting methods for the direct measurement of transaction costs, and to provide empirical evidence for how transaction costs have effect on cor...

The aim of this study is to investigate the effects of outside board on rm value in Tehran Stock Exchange (TSE) from the perspective of information transaction costs. To do so, a sample of 96 firms listed in TSE is selected to be studied during the period of 2003-2012. Tobin q ratio is used to measure rm's value and bid-ask spread for information transaction costs. In addition to these variable...