Document Type
Article
Publication Title
Alabama Law Review
Abstract
The provision of research, particularly through sell-side and independent analysts, is not free of problems. Scandals in the United States involving the truthfulness of analyst-supplied research—at Merrill Lynch, among other large Wall Street firms, as uncovered by New York State Attorney General Eliot Spitzer in the early 2000s—highlight the risks facing investors that rely uncritically on sell-side research. In Part II, this Article provides an overview of the market failures that affect sell-side and independent analyst research and lead potentially to conflicts of interest and bias in that research. Part III canvasses the existing empirical research on analyst research, identifying key levers that regulators may rely upon in seeking to reform the provision of analyst research. Part IV discusses possible regulatory interventions that may reduce the severity of the market failures affecting analysts, including the possibility of analyst subsidies allocated based on a tournament among analysts.
First Page
161
Volume
59
Publication Date
2007
Recommended Citation
Stephen J. Choi,
The Problems with Analysts,
59
Alabama Law Review
161
(2007).
Available at:
https://gretchen.law.nyu.edu/fac-articles/1395
