Gender Discrimination In P2P Online Lending In China

Peer-to-Peer Online Lending(P2P)is a kind of direct lending mode,which is a kind of point-to-point network lending,in which individuals and individuals deintermediate through the network information intermediary.Since the first Internet lending platform was established in 2007,the development of the whole industry can be described as "barbaric growth".In 2017,the total volume of P2 P net loan industry volume exceeded 6 trillion yuan mark.Many scholars have found that in the field of P2 P network lending,there are discriminatory acts against borrowers' personal characteristics such as gender,educational background and so on.The existence of such discrimination means the inefficiency of the allocation of resources,as well as the manifestation of social injustice.Is there any discrimination against women in China's P2 P lending market? What kind of form is it? What is the nature of specific discrimination? What is the reason for this discrimination? What adverse effects does it have? How should we improve the situation of discrimination?Becker(1957)and Arrow(1973)put forward the conceptual framework of analytical discrimination,which is divided into "irrational preference discrimination" and "effective statistical discrimination" according to their nature.When a person would rather give up part of the utility,but also insist on making some kind of differential behavior,this behavior is irrational preference discrimination.And validity statistical discrimination is a rational choice for a person to use the average level or general characteristics of a certain identity group as an alternative value.This paper extends the framework to network lending,mainly using Renren Credit Target Data Set and Probit Binary Regression Model to study the above problems.The following three findings are obtained:(1)From the point of view of repayment default,the default rate of men is significantly higher than that of women.It shows that after controlling other variables,men still have more default tendency than women.(2)From the point of view of the success rate of borrowing,it is found that there are differences between men and women in the success rate of borrowing,and women are more likely to obtain loans than men.From this point of view,it shows that there is discrimination against men in P2 P network lending,and combined with the findings that(1)there is a significant difference in the default rate between men and women,because the male default rate is significantly higher,the discrimination against men in obtaining loans is a rational choice,that is,there is discrimination against men in P2 P network lending.Effective statistical discrimination.(3)From the perspective of borrowing interest rates,the borrowing rate of women is significantly lower than that of men.Combined with the findings(1)Male breach rate will be significantly higher than female cases,where discrimination against men is also valid statistical discrimination.Because men are more likely to default than women,rational investors should,of course,demand higher interest rates to compensate for the higher default risk.Based on the findings of this study,the following recommendations are made:(1)It is suggested that investors should invest rationally in the process of P2 P network lending and not reduce the expected return because of individual irrational preference.(2)It is suggested that borrowers should strive to let investors see more high-quality information and disclose the information of themselves and the project itself comprehensively and truly.Information based symmetric investors are most likely to make rational choices.(3)It is precisely because of the symmetry of information and the importance of information integrity in network lending that platforms,as intermediaries of information,must strengthen their own responsibilities and norms.Therefore,it is suggested that the government implement a strict and unified information disclosure system for P2 P network lending,so that investors can see high-quality information on all platforms;establish and use a unified personal credit risk assessment and inquiry system in China,increase the cost of information fraud and default,but also help investors to make rational choices;strengthen government;The government and supervision departments should strengthen the supervision of the platform to further eliminate irregular and inferior platforms;the people in China are generally lack of basic financial knowledge and risk awareness,so we should strengthen the financial education in China.