Research On Herding Based On P2p Platform

Since 2005,when Zopa,the world's first peer-to-peer lending site,has been established,the market for p2 p lending has grown rapidly.P2 p lending markets allow individuals to borrow money without using financial institutions as a medium.For three reasons,this is considered an innovative financial approach.First,typically,a lender relies on a large group of lenders,and each person only needs to contribute a small percentage of the money.Second,because every potential lender can see how many people have invested in this lender,its social dimension is more prominent.Third,lenders in p2 p lending markets are retail investors,compared with lenders.Not only do they fail to assess the borrowers' creditworthiness,but the level of creditworthiness is highly correlated with the borrower's default risk,and they can't get enough information to make a decision.These characteristics allow investors to make investment decisions without being completely rational.So there is the irrational investment behavior of the herd behavior.Herd behavior exists in the global stock market.However,few articles have studied whether lenders have herd behavior in the p2 p lending market.This study used from everyone on web interface to obtain loan,from May 2010 to December 2010,the data,including 4855914 bid for 4855914 loan request,to detect before accumulated bidding and bid for the dynamic relationship between the current period.We found that in the p2 p lending market,lenders seem to be imitating other people's behavior,namely,herd behavior under the condition that the percentage and time limit effect is controlled.