2018-06-08 | 林明锋：Institutional Investors in Online Peer-to-Peer Lending
Despite its name, online peer-to-peer lending in the US and UK is increasingly dominated by institutional investors. As is well known, institutional investors play a critical role in traditional finance. But we still have little understanding of their behaviors and impacts on this market. In this presentation, I will discuss two research projects with my coauthors Richard Sias (University of Arizona) and Zaiyan Wei (Purdue University). We see the peer-to-peer lending context as an opportunity to test several theoretical predictions in finance and economics empirically, and both projects use data from Prosper.com, one of the earliest peer-to-peer lending platforms. One study seeks to understand whether institutional investors are truly able to “exploit” retail investors, using a unique period on the platform. We find that institutional investors are indeed able to exploit retail investors and obtain higher returns, but the difference is not as dramatic as theories would suggest. The second paper builds on the existing literature on herding to study the implications of explicit investor differentiation for herding, and the rationality of herding, using a natural experiment on the platform where institutional investors began to be explicitly labeled and distinguished from retail investors.
Mingfeng Lin is an Associate Professor of Information Technology Management at the Scheller College of Business, Georgia Institute of Technology. He studies online crowdfunding (particularly its debt and equity forms), online labor markets, and other online platforms. He is a fellow at Cambridge Centre for Alternative Finance at Cambridge Judge Business School, and a research affiliate at the Center for Analytical Finance, University of California Santa Cruz. His research has appeared in leading journals Management Science and Information Systems Research and has won several best paper awards, as well as the Sandy Slaughter Early Career Award of INFORMS Information Systems Society. He is an associate editor at Information Systems Research, one of the track co-chairs for the 2018 International Conferences on Information Systems (Economics and IS track), and his research has been funded by the Kauffman Foundation for Entrepreneurship, Economic Club of Washington, among others. He received his BA and MA in Economics from Beijing University, and MA in Economics and Ph.D. in Business and Management (Information Systems) from the University of Maryland, College Park. From 2010 to 2018 he worked at the Eller College of Management, University of Arizona, as an Assistant Professor (2010-2017), then as a tenured Associate Professor (2017-2018).