How does ESG (environmental, social, and governance) performance affect stock returns?
Answering this question is difficult because existing measures of ESG perfor-mance—ESG …

Over the last two decades, the unprecedented increase in non-bank financial intermediation,
particularly the rise of open-end mutual funds and exchange-traded funds, accounts for …

Benchmarking incentivizes fund managers to invest a fraction of their funds' assets in their
benchmark indexes, and such demand is inelastic. We construct a measure of inelastic …

We model asset management as a continuum between active and passive: managers can
deviate from benchmark indices to exploit noise trader–induced distortions, but agency …

Each time a stock gets added to or dropped from an index, we ask:“How much money would
have to be tracking that index to explain the huge spike in rebalancing volume we observe …

Emerging market corporations have significantly increased their borrowing in international
debt markets since 2008. We provide a detailed dive into this borrowing by showing that it …

We examine the governance implications of passive fund growth. In our model, investors
allocate capital between passive funds, active funds, and private savings, and funds' fees …

We propose a novel objective function for constructing dynamic investment strategies with
the goal of outperforming an investment benchmark at multiple points of evaluation during …

This paper provides novel empirical evidence on portfolio rebalancing in international bond
markets through the prism of investors' demand for bonds. Using a granular dataset of global …

We propose a tractable model of asset management in which benchmarking arises
endogenously, and analyze its welfare consequences. Fund managers' portfolios are not …