Stock market indices are central to the modern financial system. They are used for everything from benchmarking fund performance, to compensating executives, to evaluating the general state of the market. In recent years, the rise of index—or “passive”—investing has only added to their importance.

Despite this importance, indices have received very little attention. With a few exceptions, most scholars—and even market participants—do not think too hard about where the indices actually come from. Instead, they are generally treated as passive entities, which simply are. Obviously this can’t really be true: indices do not fall from the sky. Instead, they are the product of a series of decisions made by some person or persons. But the nature and scope of these decisions has so far been overlooked.

In a forthcoming article, I provide the first detailed empirical analysis of the landscape of domestic equity indices.

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