Implications of priority access in markets with experts: Evidence from online marketplace lending

Anparasan Mahalingam, Mohammed Alyakoob, Mohammad Rahman

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

Platform governance mechanisms such as market access control help to align all market players towards a specific value proposition. Our study focuses on understanding an important market access control mechanism: platform owners granting priority access to a subset of supply-side complementors to grow the marketplace and remove potential demand-side bottlenecks. We study the interplay between priority access and the variation in expertise of the complementors. Leveraging a randomized priority access given to expert institutional investors in online peer-to-peer lending industry, we show that it creates negative spillover effect on the performance of crowd retail investors. We provide evidence in support of two mechanisms in driving the impact of priority access, the intensity of priority access and cream-skimming by institutional complementors, on the retail crowd market.

Original languageEnglish (US)
Title of host publicationInternational Conference on Information Systems, ICIS 2020 - Making Digital Inclusive
Subtitle of host publicationBlending the Local and the Global
PublisherAssociation for Information Systems
ISBN (Electronic)9781733632553
StatePublished - 2020
Externally publishedYes
Event2020 International Conference on Information Systems - Making Digital Inclusive: Blending the Local and the Global, ICIS 2020 - Virtual, Online, India
Duration: Dec 13 2020Dec 16 2020

Publication series

NameInternational Conference on Information Systems, ICIS 2020 - Making Digital Inclusive: Blending the Local and the Global

Conference

Conference2020 International Conference on Information Systems - Making Digital Inclusive: Blending the Local and the Global, ICIS 2020
Country/TerritoryIndia
CityVirtual, Online
Period12/13/2012/16/20

Keywords

  • Corporate strategy
  • Credit markets
  • Institutional investors
  • Market design
  • Peer-to-peer (P2P) lending
  • Platform governance
  • Priority access

ASJC Scopus subject areas

  • Computer Science Applications
  • Statistics, Probability and Uncertainty
  • Library and Information Sciences
  • Applied Mathematics

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