[Show abstract][Hide abstract] ABSTRACT: This paper investigates default risk for online social lending markets based on group membership. Online social lending refers to loan auction websites where individuals lend money to other individuals. Being a member of a social lending group within an online lending community is associated with significantly decreased default risk only if membership holds the possibility of real-life personal connections. Loans for non-group borrowers appear to behave like arm’s-length transactions, whereas loans for group borrowers have characteristics similar to relationship banking. The effect of private soft information on the interest rate of group loans is isolated and shown to be significant via orthogonalization of the public credit score and a proxy for the private credit score known only within the group.
[Show abstract][Hide abstract] ABSTRACT: After the fall of Lehman Brothers and the start of the financial crisis is a break in economic activity, evidences a lack of financial attributed to information asymmetry experienced by the financial system. This paper will see how it has been analyzed by different economists this phenomenon that makes credit rationing and moral hazard. This issue is more severe because banking regulation establishes strict coverage criteria to operations that boost this exclusive effect. guarantee activity is beneficial for the entrepreneur and for financial institutions, finding common interests on them that, joined to the public sector, shape the guarantee activity as a policy that find the most effective coordination vectors between agents. However, test how the system no develops guarantee on the Spanish economy to achieve the desired volumes.
Series MPRA Paper from University Library of Munich, Germany. 05/2012; 39773(Posted 2).
Data provided are for informational purposes only. Although carefully collected, accuracy cannot be guaranteed. The impact factor represents a rough estimation of the journal's impact factor and does not reflect the actual current impact factor. Publisher conditions are provided by RoMEO. Differing provisions from the publisher's actual policy or licence agreement may be applicable.