Narrow Results

Online peer-to-peer (P2P) lending is an emerging financial mode that combines the Internet with private lending to provide unsecured lending among individuals. The interest rate and risk depend on online lenders and borrowers’ behavior choices and game in the context of P2P lending. In this paper, we propose an evolutionary behavior forecasting model for online participants based on the risk preference behavior of lenders and the credit choice of borrowers. We highlight four evolutionary equilibrium states of online lenders and borrowers’ behavior and their effects on the risk of online P2P lending platforms. We run a numeric experiment using the Paipaidai platform in China as a case and find that the evolutionary behavior of online lenders and borrowers is determined by the mutual effect of the interest rate, information gathering cost, borrowing cost, and yield rate. This paper uses evolutionary game methodology to analyze online P2P lending behavior in China and explores P2P fund success from the dual perspective of lenders and borrowers.

Cooperative advertising (coop-ad) programs with both accrual rates and participation rates are popularly adopted in practice by manufacturers and retailers to share advertising expenditures. However, results from extant literature show that the accrual rates always negatively impact the manufacturers’ performances, indicating a gap between theory and practice. In this paper, we study a coop-ad program in a distribution channel consisting of a manufacturer and a retailer with risk preferences under demand uncertainty. When both the channel members are risk-neutral, we show that an elaborately specified accrual rate can help reach channel coordination, although the accrual rate always negatively impacts the manufacturer’s performance. When the manufacturer is risk-averse and the retailer is risk-neutral, the accrual rate may positively impact the manufacturer’s performance, and in particular, the manufacturer does prefer a coop-ad program with an accrual rate if his risk-averse level is high and/or the demand volatility is high. When both the channel members are risk-averse, numerical examples illustrate that an accrual rate may benefit both members when the retailer has high profitability and low risk-averse level. These findings, seemingly never reported in the literature, provide plausible explanations for the fact that accrual rates are usually included in coop-ad programs in real-world practice.