@techreport{NBERw3513,
 title = "A Simple Model of Useless Speculation",
 author = "Murray C. Kemp and Hans-Werner Sinn",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "3513",
 year = "1990",
 month = "November",
 URL = "http://www.nber.org/papers/w3513",
 abstract = {The paper presents a general equilibrium model of a pure exchange economy with stochastic endowment in which speculation is profitable and stabilizes prices, but is useless from a welfare point of view. Reconciling the Siegel paradox with the theory of incomplete markets we show that banning speculation by closing the forward exchange market may increase social welfare.},
}