Message Framing in P2P Lending Relationships

Huang, Jin and Sena, Vania and Li, Jun and Ozdemir, Sena (2021) Message Framing in P2P Lending Relationships. Journal of Business Research, 122. pp. 761-773. ISSN 0148-2963

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This paper investigates whether language and associated message framing (low-cost signal) can provide a solution to the risks generated by asymmetric information in P2P lending, drawing on the signalling and message-framing theories. First, it examines the extent to which message framing is associated with funding outcomes in the context of P2P lending; second, it investigates whether positive message framing reinforces the positive impact of credit ratings (high-cost signal) on funding outcomes. Our analysis is conducted on a dataset of 33028 listings of potential borrowers from a Chinese P2P lending platform using the Heckman selection models. We find that the use of positively framed messages is positively associated with positive funding outcomes and enhances the positive impact of the credit ratings on funding outcomes. Our results contribute to the literature on the effectiveness of low-cost signals in of Internet-based interactions while highlighting complementarities between different types of signals in P2P lending.

Item Type:
Journal Article
Journal or Publication Title:
Journal of Business Research
Additional Information:
This is the author’s version of a work that was accepted for publication in Journal of Business Research. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Journal of Business Research, 122, 2020 DOI: 10.1016/j.jbusres.2020.06.065
Uncontrolled Keywords:
?? signalling theory; message framing; p2p ??
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Deposited On:
07 Jul 2020 13:05
Last Modified:
17 Apr 2024 00:47