event
Vilfredo Pareto Research Seminar
Tuesday
24
September
Nicola Pavanini

Fintech and the value of financial disintermediation

Nicola Pavanini, Tilburg University
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Room S5 (Petal 1), Maison de la paix, Geneva.

The Vilfredo Pareto Research Seminar is the Economics department's weekly seminar, featuring external speakers in all areas of economics.

 

As part of the Vilfredo Pareto Research Seminar series, the International Economics Department at the Graduate Institute is pleased to invite you to a public talk given by  Nicola Pavanini, Assistant Professor at Tilburg University.

Abstract: We develop and estimate an equilibrium model of marketplace lending to quantify its welfare and stability implications relative to traditional lending. We use the universe of data from one of the leading Chinese peer-to-peer lending platforms that allows for both direct and platform-intermediated lending through portfolio products. The dataset includes detailed information on borrowers, loans, lenders’ port-folio and platform investment. We use our structural model to quantify the value of financial disintermediation, simulating a counterfactual scenario where the platform resembles a bank in its intermediated lending by making maturity transformation and facing rollover risk. We find that under high rollover risk going from marketplace to traditional lending would reduce platform profits by almost $12m, lenders’surplus by around $0.2m, and the amount of loans financed by over 4%.

Nicola Pavanini obtained his PhD in Economics at the University of Warwick in 2013. Later, he became Post Doctoral Researcher at the University of Zürich at the Chair for Applied Microeconomics, before joining the Centre for Economic Policy Research (CEPR) as a Research Affiliate. His research interests include empirical industrial organisation and empirical models of asymmetric information.