In Military We Trust: The Effect of Managers’ Military Background on Mutual Fund Flows

Abstract

This paper shows that trust-building characteristics of fund managers affect purchase decisions of mutual fund investors. We exploit variation in fund managers' prior affiliations with the U.S. military, a well-trusted institution, and relate it to fund flows. Funds with ex-military managers receive significantly higher flows and have a 6.5% faster annual growth rate relative to other funds. Investor inclination toward these managers strengthens with their military involvement and its salience and with nationwide confidence in the military. Military managers' superiority in competition for investor funds is not due to variation in fund or managerial attributes and is robust to alternative explanations.JEL classification: G11, G23.

The Secret Lives of Names? Name Embeddings from Social Media

“…Models which discriminate on such criteria are a growing social concern [25]. Name embeddings have the potential to help identify biases, as name embedding-based classifiers [37] are already widely used by over 100 social scientists and economists to study discrimination and homophily [14,34,35]. For example, Gornall and Strebulaev find that Asian entrepreneurs received a 6% higher rate of interested replies than White, after sending 80,000 pitch emails introducing promising but fictitious start-ups to 28,000 venture capitalists [17].…”