Brown, Zach Y.; Egan, Mark L.; Jeon, Jihye; Jin, Chuqing; … - National Bureau of Economic Research - 2023
Index funds are one of the most common ways investors access financial markets and are perceived to be a transparent … and low-cost alternative to active investment management. Despite these purported virtues of index fund investing and the … power. Why do index funds have market power? We develop a novel quantitative dynamic model of demand for and supply of index …