This article examines a theoretically-motivated measure of the "size effect" known as Market Diversity and links it to the relative returns of institutional actively managed portfolios. Market Diversity reflects how disperse or concentrated capital is across firms in the market, with changes in...

Low spreads between loan rates and deposit rates are indicative of a more efficient financial system. We argue that spreads are better cross country measures of banking system efficiency than the net interest margins used in previous studies. We present theoretical and empirical evidence that...