Work

Why does regional information matter? evidence from peer-to-peer lending

Year: 2020

Type: article

Abstract: In this paper, we study regional discrimination in a peer-to-peer lending scenario and provide novel empirical evidence for theories of soft information collection and information cost. We find that the regional information matters for borrowers' funding probabilities and that discrimination is profit-oriented or taste-oriented depending on the specific region. Moreover, using borrowers' birthplace as an instrumental variable, we find no evidence of genuine discrimination based purely on region in the peer-to-peer lending market.

Source: European Journal of Finance

DOI: 10.1080/1351847x.2020.1720262

Authors: Tong Wang, Sheng Zhao, Xin Shen

Institutions: University of Edinburgh, Xi’an Jiaotong-Liverpool University

Language: English

Topic: FinTech, Crowdfunding, Digital Finance

Subfield: Management Information Systems

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Reduced inequalities

Open Access status: green

Funder: University of Edinburgh