Who benefits (more) from the growth of data?

Abstract

Do asset managers benefit equally from the growth of data? Exploiting the staggered implementation of a regulatory shock that eases the processing of unstructured corporate information into structured data, I find that compared to other asset managers, institutions with more financial analysts: (1) have better performance on stocks with lower data processing costs; (2) increase their investments in the treated stocks, both on intensive and extensive margins. The opposite is true for institutions with more IT experts. These results suggest that structured (unstructured) data complement financial analysts (IT experts) and technological innovations and regulations that enhance data availability have unequal impacts on institutions and their employees.