We study the determinants of compensation in the mutual fund industry using Israeli tax records. The portfolio manager compensation is influenced by fund flows driven by past raw returns. Managers are thus paid equally for fund superior performance and for the fund's passive benchmark returns....

Controversies around commission-based financial advice led many policy makers worldwideto introduce commission caps. Are these regulations effective in reducing prices offinancial products and stimulating investment? I examine these questions in the contextof mutual fund market by estimating the...