Competition, Market Structure, and Bid‐Ask Spreads in Stock Option Markets

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Trading Your Neighbor's Etfs: Competition or Fragmentation? (2001, unknown): “Mayhew (2002) and DeFontnouvelle et al. (2000) find that competition among options exchanges significantly reduces both quoted and effective spreads.”
An Empirical Portfolio Perspective on Option Pricing Anomalies (2007, background): “These estimates are conservative and may represent upper bounds to the extent that investors are able to trade within the quoted bid-ask spreads, as shown for individual options in Mayhew (2002).”
Cross-Section of Option Returns and Volatility (2009, background): “De Fontnouvelle, Fisher, and Harris (2003) and Mayhew (2002) show that the effective spreads for equity options are large in absolute terms but small relative to the quoted spreads. Typically the ratio of effective to quoted spread is less than 0.5. On the other hand, Battalio, Hatch, and Jennings (”
Using Matched Samples to Test for Differences in Trade Execution Costs (2009, unknown): “derivatives, such as in Mayhew (2002). In other contexts, when in doubt, researchers might consider conducting simulation experiments similar to those described here.”
Illiquidity Premia in the Equity Options Market (2018, background): “Furthermore, we control for firm-specific characteristics such as size and leverage which have been shown to affect the distribution of options prices, see for instance Dennis and Mayhew (2002) and Duan and Wei (2009).”