Journal of Economic Methodology· 2026Q2
Hiding in plain sight: the concept of fiduciary duty in financial economics
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- Q2SCImago
- 2026year
Short summary
Fiduciary duty, a key normative assumption in investment practice, is often implicitly or superficially addressed in financial economics literature, hindering conceptual clarity and transparency.
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Key points
- Fiduciary duty is a key normative assumption in financial investment practice.
- Most financial economics literature engages superficially with the definition of fiduciary duty.
- Few authors explicitly discuss the values embedded in different definitions of fiduciary duty.
- Deeper engagement with fiduciary duty is needed for conceptual clarity, comparability, and transparency.
AI-generated from the title and abstract; the full text is not read.
Abstract
We discuss the role of fiduciary duty in financial economics. We first demonstrate that there are different levels of depth of engagement with the content of the definition of fiduciary duty in the financial literature. Most contributors tacitly presume a narrow definition of fiduciary duty or merely mention it in passing. Only some authors provide more detailed definitions. And very few authors explicitly discuss the values at play in different definitions of fiduciary duty. The concept of fiduciary duty, while a key normative assumption underlying investment practice, seems to hide in plain sight in the current debates. We argue that deeper engagement with the concept of fiduciary duty is desirable. Such deeper engagement improves conceptual clarity, comparability across analyses, and transparency about normative assumptions. Doing so also contributes to responsible financial economics understood as the obligation to make normatively consequential assumptions explicit.
The authors' abstract, as published at the source. Journal of Economic Methodology, 2026 · DOI ↗
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