|
on Payment Systems and Financial Technology |
|
Issue of 2024‒01‒29
seventeen papers chosen by |
| By: | Estrin, Saul (London School of Economics); Khavul, Susanna (San Jose State University); Kritikos, Alexander S. (DIW Berlin); Löher, Jonas (IfM Bonn) |
| Abstract: | Financing entrepreneurship spurs innovation and economic growth. Digital financial platforms that crowdfund equity for entrepreneurs have emerged globally, yet they remain poorly understood. We model equity crowdfunding in terms of the relationship between the number of investors and the amount of money raised per pitch. We examine heterogeneity in the average amount raised per pitch that is associated with differences across three countries and seven platforms. Using a novel dataset of successful fundraising on the most prominent platforms in the UK, Germany, and the USA, we find the underlying relationship between the number of investors and the amount of money raised for entrepreneurs is loglinear, with a coefficient less than one and concave to the origin. We identify significant variation in the average amount invested in each pitch across countries and platforms. Our findings have implications for market actors as well as regulators who set competitive frameworks. |
| Keywords: | equity crowdfunding, soft information, entrepreneurship, finance, financial access and inclusion |
| JEL: | D26 G23 G41 L26 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16679&r=pay |
| By: | Yoshikawa, Katsuhiko; Wu, Chia-Huei; Lee, Hyun-Jung |
| Abstract: | Organisations are increasingly introducing online platforms to facilitate knowledge sharing among employees across organisational boundaries. Nonetheless, individuals do not always share knowledge on such platforms. This study aims to identify the factors that can motivate individuals to share knowledge on an online platform drawing on social exchange theory and the idea of generalised exchange, a form of social exchange identified on online knowledge-sharing platforms in previous studies. Specifically, we propose that individuals are more likely to share knowledge on online platforms when they have requests from an employee with whom they have worked in the same office in the past but do not currently work in the same office location (i.e. past-collocation history), have high levels of generalised exchange orientation, and need to use a wide variety of knowledge to complete their jobs (i.e. knowledge variety). Using a longitudinal dataset spanning 6 months among 100 users on an in-house online platform of a professional service firm, we find support for the three-way interaction hypothesis in a three-level analysis. We discuss implications on knowledge sharing on in-house online platforms. |
| Keywords: | knowledge sharing; online platforms; generalised social exchange; generalised exchange orientation |
| JEL: | J50 |
| Date: | 2022–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:117627&r=pay |
| By: | Mingxuan He |
| Abstract: | I study the price dynamics of non-fungible tokens (NFTs) and propose a deep learning framework for dynamic valuation of NFTs. I use data from the Ethereum blockchain and OpenSea to train a deep learning model on historical trades, market trends, and traits/rarity features of Bored Ape Yacht Club NFTs. After hyperparameter tuning, the model is able to predict the price of NFTs with high accuracy. I propose an application framework for this model using zero-knowledge machine learning (zkML) and discuss its potential use cases in the context of decentralized finance (DeFi) applications. |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2312.05346&r=pay |
| By: | Giulio Cornelli; Fiorella De Fiore; Leonardo Gambacorta; Cristina Manea |
| Abstract: | Fintech credit, which includes peer-to-peer and marketplace lending as well as lending facilitated by major technology firms, is witnessing rapid growth worldwide. However, its responsiveness to monetary policy shifts remains largely unexplored. This study employs a novel credit dataset spanning 19 countries from 2005 to 2020 and conducts a PVAR analysis to shed some light on the different reaction of fintech and bank credit to changes in policy rates. The main result is that fintech credit shows a lower (even non-significant) sensitivity to monetary policy shocks in comparison to traditional bank credit. Given the still marginal – although fast growing – macroeconomic significance of fintech credit, its contribution in explaining the variability of real GDP is less than 2%, against around one quarter for bank credit. |
| Keywords: | fintech credit, monetary policy, PVAR, collateral channel |
| JEL: | D22 G31 R30 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:1157&r=pay |
| By: | Andrea Coveri; Claudio Cozza; Dario Guarascio |
| Abstract: | This work analyzes the mutual dependence linking digital platforms, i.e., 'Big Tech', and the military apparatus. Three main elements are at the roots of such dependence: an 'originary linkage' binding the development of digital platforms with governments' R&D military efforts, the critical nature of infrastructures and technologies controlled by platforms, and their role as their government's 'eyes and ears' (both at home and abroad). Focusing on the US, we first document the growing relevance of these corporations as Department of Defence contractors. Second, we explore a selection of multi-year contracts entrusting platforms to develop and manage critical technologies and infrastructures for military purposes. Finally, we document the direct involvement of major US-based platforms in war scenarios. |
| Keywords: | Monopoly capital; imperialism; war; nation-states; digital platforms; military industry |
| JEL: | L12 L22 P12 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:sap:wpaper:wp244&r=pay |
| By: | Raffaele Giuseppe Cestari; Filippo Barchi; Riccardo Busetto; Daniele Marazzina; Simone Formentin |
| Abstract: | Accurately forecasting the direction of financial returns poses a formidable challenge, given the inherent unpredictability of financial time series. The task becomes even more arduous when applied to cryptocurrency returns, given the chaotic and intricately complex nature of crypto markets. In this study, we present a novel prediction algorithm using limit order book (LOB) data rooted in the Hawkes model, a category of point processes. Coupled with a continuous output error (COE) model, our approach offers a precise forecast of return signs by leveraging predictions of future financial interactions. Capitalizing on the non-uniformly sampled structure of the original time series, our strategy surpasses benchmark models in both prediction accuracy and cumulative profit when implemented in a trading environment. The efficacy of our approach is validated through Monte Carlo simulations across 50 scenarios. The research draws on LOB measurements from a centralized cryptocurrency exchange where the stablecoin Tether is exchanged against the U.S. dollar. |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2312.16190&r=pay |
| By: | Chipurenko, Elena (Чипуренко, Елена) (The Russian Presidential Academy of National Economy and Public Administration); Lisitskaya, Tatyana (Лисицкая, Татьяна) (The Russian Presidential Academy of National Economy and Public Administration) |
| Abstract: | TThe subject of the study is the procedure for financial accounting and audit of digital assets, which in recent years have become significant distribution as objects of current business activity. The aim of the study was to analyze Russian and international practice to select the possible approaches of reliable and uniform reflection in the corporate reporting of digital assets and audit methods. The study was carried out during 2022 based on the department of accounting, economic analysis and audit of the Russian Academy of National Economy and the Presidential Service of the Russian Federation (RANEPA). Relevance. The absence of the rules for identifying and classification of digital assets in financial accounting does not allow to correctly reflect in the reports of organizations significant objects. No jurisdiction in the world has accounting standards for digital assets, and the IFRS Foundation only in 2022 set a priority task for developing the rules for accounting for digital assets. The research methodology is based on theoretical and practical methods. An inductive research approach is the desire to understand the nature of the problem related to digital assets. High -quality research method is a subjective assessment of attitudes, expert opinions in the field of digital assets. Practical research methods follow from theoretical and are mainly data collection and their analysis. Based on the results of the study, conclusions were drawn about the need: — for financial accounting for the clarification of the term “digital currency”, established by law, to divide the concepts of decentralized digital currency and the digital ruble of the Central Bank of the Russian Federation; — development of the federal standard of accounting of operations with crypto actures; — distinguish between the issues of accounting for crypto acts for commercial organizations of the real sector of the economy and professional participants in the financial market. Recommended: — before the development of the federal standard, use a single approach to identify crypt-toactics as intangible assets in accordance with the accumulated practice; — creation of publicly accessible terminological reference books in relation to digital assets with regular actualization; — Creating an information resource about digitalization risks. |
| Keywords: | financial accounting, financial reporting, digital assets, accounting standards, assets assessment, audit of digital assets, distributed ledger technology (DLT), blockchain, crypto assets |
| Date: | 2022–11–17 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:wpaper:w20220306&r=pay |
| By: | Niklas Valentin Lehmann |
| Abstract: | Open online crowd-prediction platforms are increasingly used to forecast trends and complex events. Despite the large body of research on crowd-prediction and forecasting tournaments, online crowd-prediction platforms have never been directly compared to other forecasting methods. In this analysis, exchange rate crowd-predictions made on Metaculus are compared to predictions made by the random-walk, a statistical model considered extremely hard-to-beat. The random-walk provides less erroneous forecasts, but the crowd-prediction does very well. By using the random-walk as a benchmark, this analysis provides a rare glimpse into the forecasting skill displayed on open online crowd-prediction platforms. |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2312.09081&r=pay |
| By: | Carletti, Elena; Leonello, Agnese; Marquez, Robert |
| Abstract: | Bank market power, both in the loan and deposit market, has important implications for credit provision and for financial stability. This article discusses these issues through the lens of a simple theoretical framework. On the asset side, banks choose the quality and quantity of loans. On the liability side, they may be subject to depositor runs whenever they offer demandable contracts. This structure allows us to review the literature on the role of market power for credit provision and stability and also highlight the interactions between the two sides of banks’ balance sheets. Our approach identifies relevant channels that deserve further analysis, especially given the rising importance of bank market power for monetay policy transmission and the the rise of the digital economy. JEL Classification: G01, G21, G28 |
| Keywords: | balance sheet interactions, bank runs, credit provision, digital economy, monetary policy transmission |
| Date: | 2024–01 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20242886&r=pay |
| By: | Hao Wang |
| Abstract: | Borda Count Method is an important theory in the field of voting theory. The basic idea and implementation methodology behind the approach is simple and straight forward. Borda Count Method has been used in sports award evaluations and many other scenarios, and therefore is an important aspect of our society. An often ignored ground truth is that online cultural rating platforms such as Douban.com and Goodreads.com often adopt integer rating values for large scale public audience, and therefore leading to Poisson/Pareto behavior. In this paper, we rely on the theory developed by Wang from 2021 to 2023 to demonstrate that online cultural rating platform rating data often evolve into Poisson/Pareto behavior, and individualistic voting preferences are predictable without any data input, so Borda Count Method (or, Range Voting Method) has intrinsic fallacy and should not be used as a voting theory method. |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2312.10405&r=pay |
| By: | Hasan, Iftekhar; Li, Xiang; Takalo, Tuomas |
| Abstract: | This paper studies whether and how banks' technological innovations affect the bank lending channel of monetary policy transmission. We first provide a theoretical model in which banks' technological innovation relaxes firms' earning-based borrowing constraints and thereby enlarges the response of banks' lending to monetary policy changes. To test the empirical implications, we construct a patent-based measurement of bank-level technological innovation, which can specify the nature of technology and tell whether it is related to the bank's lending business. We find that lending-related innovations significantly strengthen the transmission of the bank lending channel. |
| Keywords: | Innovation, FinTech, Monetary Policy Transmission, Bank Lending Channel |
| JEL: | E52 G21 G23 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bofitp:280960&r=pay |
| By: | Morgan Blangeois (CleRMa - Clermont Recherche Management - ESC Clermont-Ferrand - École Supérieure de Commerce (ESC) - Clermont-Ferrand - UCA - Université Clermont Auvergne) |
| Abstract: | This article delves into the revolution of generative artificial intelligence (AI) in digital service companies (DSCs), focusing on foundational models like GPT-4. It examines the debates surrounding these technologies, particularly their implications in terms of misinformation through hallucinations, the social biases they carry, and their influence on the digital transformation of organizations. It begins with an exploration of the emergence of generative AI, highlighting technological advances and their practical impacts. The article assesses the current capabilities of generative AI and its potential, highlighting its role in redefining the job market, especially in terms of skills. The core of the study focuses on the challenges and strategic opportunities for DSCs. Examining how generative AI transforms traditional functions and creates new strategies, the article underscores the importance for DSCs to reconsider their position in the IT value chain. We explore how the adoption of open-innovation and business model innovations can facilitate the adaptation of DSCs to these challenges and conclude with a call for empirical studies to further explore these themes. |
| Abstract: | Cet article se penche sur la révolution de l'intelligence artificielle (IA) générative dans les entreprises de services du numérique (ESN), en mettant l'accent sur les modèles de fondation comme GPT-4. Il examine les débats entourant ces technologies, notamment leurs implications en termes de désinformation par les hallucinations, les biais sociaux qu'ils véhiculent, et leur influence sur la transformation numérique des organisations. Il débute par une exploration de l'émergence de l'IA générative, soulignant les avancées technologiques et leurs impacts pratiques. L'article évalue les capacités actuelles de l'IA générative et son potentiel, en mettant en évidence son rôle dans la redéfinition du marché du travail, notamment sur le plan des compétences. Le cœur de l'étude se concentre sur les défis et les opportunités stratégiques pour les ESN. En examinant la manière dont l'IA générative transforme les fonctions traditionnelles et crée de nouvelles stratégies, l'article souligne l'importance pour les ESN de reconsidérer leur position dans la chaîne de valeur informatique. Nous explorons comment l'adoption de l'open-innovation et les innovations des modèles d'affaires peuvent favoriser l'adaptation des ESN à ces enjeux et faisons appel en conclusion à des études empiriques pour approfondir ces thématiques. |
| Keywords: | Business Model, Digital Services Companies, Open Innovation, Artificial Intelligence, Strategy, Modèles d'affaires, Entreprises des Services du Numérique, Innovation Ouverte, Intelligence Artificielle, Stratégie |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04355219&r=pay |
| By: | Giang Nguyen (EM - emlyon business school); Hung Pham |
| Abstract: | "We find evidence that venture capital (VC)-backed targets receive more stock as the method of payment in mergers and acquisitions than non-VC-backed targets do, even after controlling for self-selection bias, differences of characteristics between transactions of VC-backed and non-VC-backed targets and VC information bridge-building. VC-backed targets prefer stock of acquirers that are small, young, risky or invest intensively. In addition, we document that the ratio of stock is larger when the targets are financed by reputable VCs, a syndicate of VCs or VCs with low fund maturity. Overall, our findings suggest that VCs strategically hold shares of the acquirers that meet their investment preferences." |
| Keywords: | Venture capital, Merger and acquisition, Method of payment |
| Date: | 2023–09–10 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04325755&r=pay |
| By: | Fischer, Lena; Zerres, Thomas |
| Abstract: | Ziel dieser Studie ist es, den Markt von FinTech Unternehmen in Deutschland unter Berücksichtigung der beteiligten Marktkräfte darzustellen. Hierfür sollen die theoretischen Grundlagen einer Marktanalyse dargelegt und darauf aufbauend eine Marktanalyse durchgeführt werden. Betrachtet werden sollen in diesem Zusammenhang auch die rechtlichen Rahmenbedingungen, die für FinTech Unternehmen in Deutschland einschlägig sind, da auch diese Einfluss auf das Marktgeschehen haben. Ziel ist es, bestehende Rechtsgrundlagen sowie Entwürfe von künftigen Rechtsvorschriften mittels Recherche zu identifizieren und zu analysieren. Betrachtet werden sollen dabei das deutsche Recht sowie das für Deutschland als Mitgliedstaat der EU geltende EU-Recht. |
| Keywords: | FinTech Unternehmen, Marktanalyse |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ouwpmm:280974&r=pay |
| By: | Taskin, Ahmet Ali; Yaman, Firat |
| Abstract: | What is the role of financial deregulation on rising finance wage premium in the US? This study makes use of the Interstate Banking and Branching Efficiency Act of 1994 as an exogenous shift to local banking markets and investigates the effect of deregulation induced competition on relative wages in finance. We find that the finance wage premium increased significantly in deregulated states. Our estimates suggests that the deregulation explains about a quarter of the increase in finance wage premium between 1994 and 2008. |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwqwdp:280992&r=pay |
| By: | Shihan Xie; Victoria Wenxin Xie; Xu Zhang |
| Abstract: | This paper explores the impact of extreme weather exposures on the financial outcomes of low-income households. Using a novel dataset comprising individual-level payday loan applications and loan-level information, we find that extreme temperature days—both hot and cold—lead to surges in demand for payday loans. An increase in the number of days with extreme heat results in an increase in delinquency and default rates and a reduction of total credit issued, indicating a contraction in loan supply. These effects are especially noticeable for online payday loans. Our findings highlight the heightened financial vulnerability of low-income households to environmental shocks and underscore the need for targeted policies. |
| Keywords: | Climate change; Credit and credit aggregates |
| JEL: | Q54 G5 |
| Date: | 2024–01 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocawp:24-1&r=pay |
| By: | Amon Aniké DEH (UASZ - Université Assane Seck de Ziguinchor [Sénégal]); Ndeye Paane KHOUMA (UCAD - Université Cheikh Anta Diop de Dakar [Sénégal]) |
| Abstract: | The purpose of this article is to study the determinants of the financial performance of MFIs in Senegal and Côte d'Ivoire, using the institutionalist approach. Our epistemological posture is positivism with a hypothetico-deductive reasoning and a quantitative approach. The data come from the BCEAO database and cover a sample of nineteen (19) MFIs during the periods from 2016 to 2019. The results of the compound error model show that size, 12_24 month portfolio at risk, capital structure, liquidity, and Doing Business index have a significant influence on the financial performance of MFIs. However, robustness tests with quantile regression at the three distribution thresholds (25%, 50%, and 75%) show that only the MFI's size, its 12-24 month PAR, and its creditworthiness have a significant impact on its financial performance. The knowledge of these factors could be useful to the managers of these MFIs in the adoption of strategies to ensure good financial viability, which is a guarantee of their sustainability and indispensable to ensure their social mission effectively. |
| Abstract: | L'objet de cet article est en embrassant l'approche des institutionnalistes, d'étudier les déterminants de la performance financière des IMF au Sénégal et en Côte d'Ivoire. Notre posture épistémologique est le positivisme avec un raisonnement hypothético-déductif et une démarche quantitative. Les données proviennent de la base de données de la BCEAO et portent sur un échantillon de Dix-neuf (19) IMF durant les périodes de 2016 à 2019. Les résultats du modèle à erreurs composées montrent que la taille, le portefeuille à risque 12-24 mois, la structure du capital, la liquidité et l'indice Doing Business ont une influence significative sur la performance financière des IMF. Toutefois, les tests de robustesse avec la régression quantile aux trois seuils de distribution (25%, 50% et 75%), montrent que seules la taille de l'IMF, son PAR 12-24 mois et son degré de solvabilité ont un impact significatif sur cette performance financière. La connaissance de ces facteurs pourrait être utile aux managers de ces IMF dans l'adoption de stratégies permettant d'assurer une bonne viabilité financière, gage de leur pérennité et indispensable pour assurer efficacement leur mission sociale. |
| Keywords: | Microfinance, Financial performance, Social performance, WAEMU, Regression, Performance financière, Performance sociale, UEMOA, Régression |
| Date: | 2023–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04363597&r=pay |