'Bank-Platform Competition in the Credit Market', with Sara Biancini (Thema, Université de Cergy-Pontoise).


The paper analyzes the equilibrium on the credit market when a bank and a platform compete to offer credit to borrowers. The platform does not manage deposit accounts, but acts as an intermediary between the borrower and the investor, offering a risky contract such that the investor is only reimbursed if the borrower is successful. We first characterize the optimal contracts proposed by the platform, depending on the two-sided structure of the market. Then, we study the impact of bank-platform competition on the average risk of bank loans and the relative level of interest rates.


Competition and Welfare Effects of Bailout Policies:
'Bailout Policies when Banks Compete with Switching Costs', with Noé Ciet (Université Paris 2).

In this paper, we analyze the welfare effects of bailout policies when banks compete with switching costs. We compare no-bailout policies to systematic bailouts. We argue that no-bailout policies increase the interest rates paid by borrowers ex ante (i.e., before a shock), whereas they may reduce the interest rates paid by consumers who are not credit constrained. Such policies increase social welfare ex post if borrowers can easily switch banks and if the credit constraints are not too severe.

Lending Platforms:
'What drives the expansion of the P2P lending', with Olena Havrylchyk (Université Paris 1), with Carlotta Mariotto (ESCP LabeX ReFi), Talal Rahim (Boston University), Best Paper Award at the Toronto FinTech Conference.

Peer-to-peer (P2P) lending platforms are online intermediaries that match lenders with borrowers. We use data from the two leading P2P lending platforms on the US consumer credit market, Prosper and Lending Club, to explore the main drivers of the expansion of demand for P2P credit. We exploit the heterogeneity in local credit markets at the county level to test three main hypotheses: 1) global financial crisis; 2) competition and barriers to entry; and 3) learning costs. We find that P2P lending platforms have partly substituted for banks in counties that were more affected by the financial crisis. High market concentration and high branch density appear to deter the entry and expansion of the P2P lending. Finally, we find a positive impact of variables that are correlated with lower learning costs, such as education, population density, high share of young population, as well as important spatial interactions.

Competition between Selling Modes:
'Platform-Merchant Competition for Selling Services' (2018), with Carlotta Mariotto (ESCP LabeX ReFi), Working Paper, submitted, in revision for publication.

In this paper, we study whether a monopolistic platform prefers to impose price parity when it competes with merchants for selling services. The platform and the direct sales channel are differentiated in quality on the consumer side and in terms of efficiency. We show that the platform imposes price parity when it is highly differentiated in quality on the consumer side and that this restriction lowers the total transaction fee paid by consumers and merchants. Price parity increases the total buying price of consumers who buy from merchants who receive high benefits of selling on the platform and decreases it otherwise.
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