  Exchanges implement intentional trade delays to limit the harmful impact of
low-latency trading. Do such "speed bumps" curb investment in fast trading
technology? Data is scarce since trading technologies are proprietary. We build
an experimental trading platform where participants face speed bumps and can
invest in fast trading technology. We find that asymmetric speed bumps, on
average, reduce investment in speed by only 20%. Increasing the magnitude of
the speed bump by one standard deviation further reduces low-latency investment
by 8.33%. Finally, introducing a symmetric speed bump leads to the same
investment level as no speed bump at all.
