Research
Lighthouse in the Dark: Search in Marketplace Lending
Presentation: 2024 AEA Poster; 2022 EEA; 2022 China Fintech Research Conference; 2020 China Finance Doctoral Forum; Bocconi Finance Brown Bag Seminar; LBS Ph.D. Seminar; 2019 Econometric Society European Winter Meeting; Bocconi La Strada Seminar; 2020 Royal Economic Society's Annual Conference (canceled due to Covid-19)
Abstract: This paper sheds light on search frictions in a two-sided online personal loan market. Technology has brought numerous unsophisticated individuals to marketplaces. Using data from a leading Chinese marketplace lending platform, I uncover the presence of a concave demand curve in this market. Borrowers in the online market are revealed mostly unsophisticated, resulting in challenges in proposing reasonable interest rates. I then exploit the staggered introduction of private lending registration service centers (PLcenters) in Chinese cities to demonstrate the role of public information services in mitigating frictions and improving the online lending market outcomes. These PLcenters aim to disseminate financial knowledge and enhance transparency. Using staggered difference-in-differences (DID) analysis, I find PLcenters effectively boost marketplace lending and increase match rates. Remarkably, PLcenters help borrowers, especially those less sophisticated, propose better interest rates, leading to reduced interest rate dispersion. In addition, I present a directed search model with imperfect private and public information to explain economic mechanisms.
Data Manipulation in Marketplace Lending with Yutong Hu [2026 June New Version Slides ] Presentation: 2026 AMES Hanoi (scheduled); 2026 NASM Atlanta; 2025 FFMM Lancaster; 2024 EARIE Amsterdam; 2024 ESEM Rotterdam; 2024 EFT Edinburgh; 2024 ZEW ICT; 2024 Wharton Financial Regulation Conference; EWMES 2023, Manchester; 2nd International Cardiff Fintech Conference; 2023 WinE Mentoring Retreat; 2022 HU-IWH Joint Junior Seminar; 2022 China Fintech Research Conference*
Abstract: This paper studies how opaque credit enhancement affects efficiency and fragility in marketplace lending. Using loan-level data from a leading Chinese P2P platform, we exploit the staggered opening of offline branches that introduced credit-enhanced loans whose covered defaults were not disclosed to investors. We find that branch openings generated at least 3.66 percentage points of monthly default-rate underreporting. This opacity reduced the informativeness of interest rates, increased bidding volume by about 70 percent, and attracted a more passive, safety-seeking investor base. However, the resulting liquidity proved fragile: following the 2015 Ezubao scandal, seller activity and selling delays rose sharply. A model of platform disclosure shows that platforms have incentives to under-disclose risk to boost trading volume, leading to excessive opacity relative to the social optimum. The findings highlight a tradeoff between liquidity creation and financial fragility in digital credit markets and underscore the importance of information disclosure.
Green Investing, Information Asymmetry, and Capital Structure
with Biao Yang
Presentation: 2024 RBFC; 2024 VfS Berlin; IAAE China 2024*; 2024 FMA Europe Turin; 2024 AFA AFFECT Mentoring; CFAC2023*; 2023 EEA*; Yonsei University; Bocconi La Strada Seminar*; 2021 Econometric Society European Winter Meeting; IWH Brown Bag Seminar
Abstract: We investigate how optimal attention allocation of green-motivated investors changes information asymmetry in financial markets and thus affects firms' financing costs. To guide our empirical analysis, we propose a model where an investor with green taste endogenously allocates limited attention to study market-level or firm-specific fundamental shocks. We find that more green-motivated investors tend to pay more attention to green firm-level information than market-level information. Thus, a higher green taste leads to less category learning behavior. It reduces the information asymmetry of green firms, leading to lower leverage and lower cost of equity capital. Moreover, the information asymmetry of brown firms and the market increases with the green taste. Greater green attention is associated with less market efficiency. We provide empirical evidence to support our model predictions by using US data. Our paper shows how the growing demand for sustainable investing shifts investors' attention and benefits eco-friendly firms.
The Voice of ECB and Financial Markets with Zihao Liu
Presentation: 2026 FutFinInfo Frankfurt Poster* (scheduled)
Abstract: We study how ECB leader voices affect European financial markets.
Work in Progress
Local Media Closures and Corporate Debt Financing
*: presented by coauthor(s)
Discussions
• 2025 Nefi Mannheim, More Thank Just Talk? ECB Climate Communication, Market Expectations and Reaction, by Felicitas Koch (Discussion Slides).
• 2024 IBEFA Summer, Unusual Financial Communication: Evidence from ChatGPT, Earnings Calls, and the Stock Market, by Lars Beckmann, Heiner Beckmeyer, Ilias Filippou, Stefan Menze, and Guofu Zhou (Discussion Slides).
• 2024 ZEW ICT, Firms and Big Data: Adoption, Use and Impacts, by Alejandro Rabano (Discussion Slides).
• 2024 FMA Europe, Big Data Availability and Asymmetric Voluntary Disclosures, by Clark Liu, Yancheng Qiu, Shujing Wang, and P. Eric Yeung (Discussion Slides).
• 2023 EFA, Reducing Entrepreneurial Capability Constraints: The Broader Role of Venture Capital Due-diligence, by Juanita Gonzalez-Uribe, Robyn Klingler-Vidra, Su Wang and Xiang Yin (Discussion Slides).
• 2022 China Fintech Research Conference, Influence of Institutional Differences on Trade Credit Use During Pandemics, by Kung-Cheng Ho (Discussion Slides).
• 2022 HUI workshop, Consumer Credit and Impulse Shopping, by Valentin Burg and Jan Keil (Discussion Slides).