Investment Management and Technology: Past, Present, and Future

Abstract

This paper analyzes how the practice of investment management has been affected over the past 45 years by technological progress, market innovations, and advances in finance theory. Over the next few decades, as retirement-income systems around the world make the transition from "pay-as-you-go" social security to self-directed retirement accounts, the investment-management business is likely to undergo a radical transformation. There will be a growing demand for customized, integrated investment and insurance products. Financial engineering will play a major role in this transformation.

JEL Classification: G19