Does team competition increase pro-social lending? Evidence from online microfinance

Chen, Roy; Yan, Cheng; Liu, Yang; Mei, Qiaozhu

doi:10.1016/j.geb.2015.02.001

Cited by 35 publications

(31 citation statements)

References 38 publications

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“…We find that emails increase the likelihood that a lender joins a team, and that joining a team increases lending in an 1-wk window following the decision to join. Although this experiment does not explore the mechanism through which joining a team increases giving, our prior empirical analyses and field experiment point to two mechanisms at work (4). First, joining a team increases information sharing about specific borrowers on the team forum, which reduces team members' search costs and increases their lending.…”

Section: Discussionmentioning

confidence: 93%

“…In comparison, an underexplored class of mechanisms uses group membership and intergroup competition (2, 3) to increase both participation and giving amounts. Compared with price-based strategies, such as matching gifts and rebates, empirical analysis of naturally occurring data indicates that identity-based mechanisms have longerlasting effects (4). Our research explores two questions through a large-scale field experiment on a crowdlending community with a natural group structure (teams).…”

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confidence: 99%

“…For example, lenders who join teams might simply be those who are more active in general (4). To establish the causal relationship between group membership and prosocial lending, we use a randomized field experiment that enables us to combine the control of a laboratory experiment with the external validity of a field study (6,7).…”

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confidence: 99%

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Recommending teams promotes prosocial lending in online microfinance

Chen

Yan

et al. 2016

Proc. Natl. Acad. Sci. U.S.A.

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This paper reports the results of a large-scale field experiment designed to test the hypothesis that group membership can increase participation and prosocial lending for an online crowdlending community, Kiva. The experiment uses variations on a simple email manipulation to encourage Kiva members to join a lending team, testing which types of team recommendation emails are most likely to get members to join teams as well as the subsequent impact on lending. We find that emails do increase the likelihood that a lender joins a team, and that joining a team increases lending in a short window (1 wk) following our intervention. The impact on lending is large relative to median lender lifetime loans. We also find that lenders are more likely to join teams recommended based on location similarity rather than team status. Our results suggest team recommendation can be an effective behavioral mechanism to increase prosocial lending.social identity | charitable giving | microfinance | field experiment | recommender systems

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Section: Discussionmentioning

confidence: 93%

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confidence: 99%

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Recommending teams promotes prosocial lending in online microfinance

Chen

Yan

et al. 2016

Proc. Natl. Acad. Sci. U.S.A.

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“…Evidence exists that organizational religious affiliation, or lack thereof, can inspire pro-social behavior. Chen et al (2017), through a field experiment using the microfinance site Kiva.org, find that joining a team increases lending and that the most popular teams in Kiva.org were either outwardly Christian or Atheist in affiliation. In terms of charitable giving, the economics literature does not have many studies focusing on the religious affiliation of charities themselves; however, there is a vast amount of literature studying how religiously affiliated individuals donate.…”

Section: Literature Reviewmentioning

confidence: 99%

Examining Donor Preference for Charity Religious Affiliation

Oxley

2020

SSRN Journal

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This paper uses a laboratory experiment to determine how charity religious affiliation drives donor preference and giving. Subjects choose from one of eight charities, with each charity varying in religious affiliation. Masked and unmasked sessions differ in the knowledge of the religious affiliation of half the charities, with masked sessions omitting the religious affiliation of the aforementioned charities. My results show that adding additional religious language decreases donation frequency for Christian charities competing exclusively against other religious charities. Additionally, adding religious language increases the average donation size for secular charities competing against Christian charities, but decreases average donations for Christian charities competing exclusively against other religious charities. Subjects prefer charity religious affiliation to match their own religious identity; however, subject strength of religiosity is more predictive in charity choice than religious affiliation of the donor. My results indicate that religiously affiliated charities have financial incentive to selectively display their affiliation.

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“…org), the first microlending website to match lenders with entrepreneurs in developing countries. In this study, Chen et al (2015) run a large-scale randomized field experiment (n = 22,233) by posting team forum messages. 2 Kiva lenders make zero-interest loans to entrepreneurs in developing countries, often out of pro-social motives (Liu et al 2012).…”

Section: Email and Textmentioning

confidence: 99%