Associate professor Zhao Li , a researcher of the Base, has published a collaborative paper titled "A Tale of Two Markets: Labor Market Mobility and Bank Information Sharing" in Journal of Economic Dynamics & Control

Abstract:

We develop a theory of bank information sharing, highlighting the interactions between credit and labor markets. A better-informed relationship bank competes with a less informed foreign bank for borrowers under asymmetric information about borrowers' creditworthiness. Credit market competition triggers competition for the relationship bank’s loan officers, who possess valuable information about the borrowers’ creditworthiness. The relationship bank can share credit information to soften the labor market competition, despite intensifying the credit market competition. When labor market mobility is moderate, information sharing emerges as the optimal strategy of the relationship bank.

Key Words: Credit market, Loan officer, Labor mobility, Information sharing

Link: A tale of two markets: Labor market mobility and bank information sharing – ScienceDirect

Teacher profile

Zhao Li is an associate professor at the School of Finance, Zhongnan University of Economics and Law, and a researcher at the Innovation and Talent Base for Digital Technology and Finance. His research fields include Banking and Financial Regulation, Banking Theory, and Corporate Finance. The research papers are accepted by academic journals like Management Science, Journal of Economic Dynamics & Control. He has led a National Natural Science Foundation Youth project and has participated in a number of National Natural Science Foundation projects.