Fenghua Song
Institution
Penn State University
PhD Year
2007
Phone
(814) 863-4905
song@psu.edu
FTG Membership
Member
Website
https://sites.google.com/site/fenghua8song/
Featured Work
Intermediated Search and the Limits of Financial Advisor Regulation
Jun 29, 2026
We study a financial advisory market in which low product relevance makes investor search unprofitable without intermediation. The advisor activates the market by recommending high-relevance products, financed by commissions from firms. Raising the regulatory penalty tightens the advisor's recommendation standard. But the resulting higher value of recommendation tempts firms to raise commissions to preserve access. This ``club effect'' partially offsets the penalty's intended effect and...
