Abstract
Recently, online P2P lending has become one of the typical modes of Internet finance. Its automatic bidding mechanism greatly improves transaction efficiency and saves transaction time. We study the herding behavior under the environment of automatic bidding mechanism through panel data regression on the transaction information from the PaiPaiDai, one of the largest P2P lending platforms in China. We find that herding behavior exists in online P2P lending. The automatic bidding mechanism is able to weaken herding effect and presents a rational herding behavior. Its behavior is very similar to those real variables, such as loan amount and loan period.
Published Version
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