| ID | 192387 |
| Title Proper | Big data pricing in marketplace lending and price discrimination against repeat borrowers |
| Other Title Information | Evidence from China |
| Language | ENG |
| Author | Tian, Geran ; Wu, Weixing |
| Summary / Abstract (Note) | In this work, we systematically investigate the pricing mechanism change from auction to big data pricing on one of the major marketplace lending platforms in China. We find that big data pricing reduces the average interest rate while the borrowers with delinquency or default histories are assigned higher interest rates. However, repeat borrowers are also faced with growing interest rates, even though they have been paying their debts on time. Further analysis shows that repeat borrowers have lower income and education levels. Moreover, investor returns become less dispersed after pricing with big data, which can be a result of homogeneous loans on the market. The implications of the above findings are discussed. |
| `In' analytical Note | China Economic Review Vol. 78, Apr 2023: p.101944 |
| Journal Source | China Economic Review 2023-04 78 |
| Key Words | Big Data ; Evidence from China |