Where do Electronic Markets Come From? Regulation and the Transformation of Financial Exchanges

Michael Castelle*, Yuval Millo, Daniel Beunza, David C. Lubin

*Corresponding author for this work

Research output: Contribution to journalJournal articleResearchpeer-review

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The practices of high-frequency trading (HFT) are dependent on automated financial markets, especially those produced by securities exchanges electronically interconnected with competing exchanges. How did this infrastructural and organizational state of affairs come to be? Employing the conceptual distinction between fixed-role and switch-role markets, we analyse the discourse surrounding the design and eventual approval of the Securities and Exchange Commission’s Regulation of Exchanges and Alternative Trading Systems (Reg ATS). We find that the disruption of the exchange industry at the hands of automated markets was produced through an interweaving of both technological and political change. This processual redefinition of the ‘exchange’, in addition, may provide a suggestive precedent for understanding contemporary regulatory crises generated by other digital marketplace platforms.
Original languageEnglish
JournalEconomy and Society
Issue number2
Pages (from-to)166-200
Publication statusPublished - May 2016


  • Financial markets
  • Production markets
  • Regulation
  • Stock exchanges
  • Technology
  • Marketplace platforms

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