Eres : Digital Library : Works

Paper eres2000_118:
LEMONS WITH A TWIST: ADVERSE SELECTION AND THE ROLE OF SECURITIZATION IN MORTGAGE MARKET EVOLUTION

id eres2000_118
authors Cutts, Amy C.; Robert A. Van Order, Peter M. Zorn
year 2000
title LEMONS WITH A TWIST: ADVERSE SELECTION AND THE ROLE OF SECURITIZATION IN MORTGAGE MARKET EVOLUTION
source 7th European Real Estate Society Conference (14-16 June 2000) Bordeaux, France
summary This paper models the development of the secondary market as a way of trading off its lower cost of securitization with adverse selection due to asymmetric information and high monitoring costs. We use a simple adverse selection model in the tradition of Akerlof (1970) with successive modifications, including licensing contracts similar to those of Leland (1979) and Chan and Leland (1982), to explain the evolution of the secondary market and discuss implications for the future, particularly as information improves.
series ERES:conference
email amy_crews_cutts@freddiemac.com
discussion No discussions. Post discussion ...
ratings
session D2 _ Mortgages and Derivatives
last changed 2009/08/07 17:25
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