Research On Incentive Regulation Of P2P Lending Platforms Based On Evolutionary Game

Regulators introduced the regulation of P2 P lending in 2016 and strengthened supervision in 2017,the strict,tight and hard regulatory environment has led to the withdrawal of a large number of platforms.Regulation aims leading industries to develop healthly,but now regulations hinder the development of the P2 P lending in China.In contrast,the UK and the USA introduced the concept of incentive supervision,appropriately relaxed the administrative supervision.So,what is the difference of regulation between China,the USA and the UK? How can the incentive regulation encourage the continuous compliance development of the P2 P lending industry? These issues deserve further exploration.This paper analyzes the differences in the current situation and the risks of P2 P lending industry between China,the UK and the USA,and analyzes the evolution of their respective regulatory processes in combination with the theory of evolutionary game.The specific research contents are as follows:First of all,we introduce the regulatory theory in order to analyze the regulatory behavior.Rent-seeking theory indicates that the power of the government should be subject to supervision to avoiding over-regulation;Regulatory differentiation theory indicates that regulation should be forward-looking.;Incentive-based theory consisits of functional regulation theory,market discipline theory and incentive regulationary theory.Secondly,by comparing P2 P industry in China,the UK and the USA,we find that P2 P industry in the UK and the USA show a steady development of mature formats,the type is more single;China’s P2 P industry is currently subject to regulatory impact,and the model is more complex,including collateral for security and transfer of claims.On this basis,analyzing the risk of the three countries’ industry,we sum up the fundamental reason for the risk difference is the supervision of the industry guidance.Thirdly,by comparing the US and UK’s P2 P regulatory process,we find that the USA experienced the path of norming,developing and exploring;the UK achieved the path of self-regulating,post-regulation and adjusting;China was first laissez-faire and then strictly regulating.Fourthly,we make an evolutionary game model to analyze the strategy choice of P2 P lending platform and regulators.We discuss the stability points of the two parties under six scenarios,and conclude that relaxed regulatory approach can guide thenon-compliance platforms to develop in compliance,while strengthening administrative regulation may aggravate the platforms’ irregularities.Finally,we draw lessons from the mature experience of the UK and the USA,and put forward suggestions as follows: regulators need to encourage innovation in an inclusive manner,develop industry self-discipline and market constraints.Also,regulators should not only build a good external environment for the development of P2 P lending,but also explore a coherent approach to regulate.