[duplicate] Efficiency of Electronic Trades in NYSE and Other Markets

We examine efficiency of Electronic Trades in NYSE and Other Markets.  We conduct a thorough analysis of execution costs on the NYSE versus a variety of electronic NASD market centers which also trade NYSE-listed stocks.  We adopt a variety of techniques attempting to correct for the selection bias problem.  Unlike current literature, we find that the electronic markets offer lower execution costs even after controlling for selection biases.  In addition to controlling for selection biases at the sample average level of order difficulty, we also carry out our analysis at different levels of order difficulty, measured by a vector of control variables.  Our results are robust under different model specifications.  Finally, our what-if analysis shows that the Electronic Markets’ (the NYSE’s) orders would have been worse (better) off, had they been executed by the NYSE (electronic markets).  Overall, our results highlight the superiority of the electronic markets’ liquidity and execution quality.