The shift from an efficient market hypothesis framework (where individual investors are information processors with votes) to a demand-side pricing model is a fundamental reframing of finance that has only occurred in the last 15-20 years, with asset pricing now understood to hinge on supply and demand for securities rather than information aggregation.
factualpending
Speaker
Dave NodicEvidence Quote
“this looking at sort of endogenous flows is a significant component of how pricing mechanisms work is a relatively new way of looking at markets, right? I mean, we've now got sort of demand asset pricing models that are sort of competing with more traditional CAPM versions of how you think about asset pricing...this move towards focus on supply and demand for securities for portfolio assets um has been from at least in my idiot head one of the biggest shifts I've seen in academic finance in the last say 15 20 years.”
Source
The Trillion Dollar Trap | Mike Green on Passive Investing's Fatal Design Flaw— Excess ReturnsCreated: 8/11/2026, 5:27:10 AM
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