Oliver Spalt (Tilburg University)
Thursday, January 31, 2013 - 2:00pm
Spandauer Strasse 1, Room 23

This paper provides evidence for substantial learning by doing effects among professional investors in a large and highly competitive segment of nancial markets. We develop a new methodology to show that experienced mutual fund managers outperform their nonexperienced counterparts by up to 67bp per quarter on a risk-adjusted basis. The key to our identication strategy is that we look "inside" funds and exploit heterogeneity in experience for the same manager at a given point in time across industries. In addition to highlighting a previously underemphasized source of observed mutual fund manager skill, our approach circumvents some of the main obstacles for the empirical literature on learning by doing effects in economics.