Taisei Noda

I’m a Ph.D Candidate at Department of Economics Rice University. My research interests include Financial Economics, Empirical Industrial Organization, and Applied Microeconomics. My recent work focuses on the industrial organization of financial markets, such as mutual funds and IPO underwriting, using structural estimation approaches.

Please contact me at taisei.noda(at)rice.edu.

Job Market Paper

Cannibalization and Scope Economies within Fund Families: The Impact of Passive Investing on Active Fund Fees

Abstract

This paper examines how the rise of passive funds, such as index funds and ETFs, impacts price competition in the mutual fund industry through structural demand and supply estimation. Modeling mutual fund companies as multi-product producers offer- ing active and passive funds, the analysis incorporates strategic pricing and economies of scale and scope. Results indicate that multi-product families raise fees by 1 to 1.5 basis points through competition internalization, while scope economies lower fees by 4.2 basis points for active funds and 27 for passive funds. A counterfactual merger analysis reveals price increases from market power outweigh cost-efficiency benefits.