Investment Funds, Inequality and Scarcity of Opportunity

Abstract

Investment funds are powerful forces today, not only in financial markets, but in broader social contexts as well. Investment fund principals have assembled vast amounts of wealth, particularly in the private fund arena. The activities of investment funds make them important gatekeepers of economic and other opportunities in a world in which opportunities for many are seemingly more scarce. Investment funds may play an important role in selecting companies for investment, which has an important impact on which companies, which people, and which ideas receive funding. Although investment fund principals may see these decisions as being neutral ones, they often are not. Who such principals are, how they select colleagues, and how they make investment and other decisions are of critical importance for the availability and allocation of varied types of opportunities.

Keywords: investment funds, inequality

JEL Classification: K29