Revisiting Mobile Effects: Interdependent Decisions in High-Stakes Platforms

Abstract

Mobile channels have enhanced convenience and driven user engagement across a wide range of industries. Yet their implications for two-sided markets, where users interact sequentially under information asymmetry, remain poorly understood. Prior research primarily examines mobile effects on one side of the market, leaving unanswered how mobile adoption reshapes cross-side interactions, information conditions, and economic outcomes. We address this gap by studying peer-to-peer (P2P) lending, a high-stakes two-sided platform characterized by sequential decisions, interdependence, and risk. We collaborate with a leading P2P lending platform to launch two-sided field experiments, in which we randomly assign mobile treatments to borrowers and lenders. Tracking the full loan lifecycle, from borrower submission to lender approval and borrower repayment, we causally identify how mobile adoption triggers a chain of behavioral and informational effects across platform sides. Complementary analyses using observational data with self-selected channels corroborate our experimental findings. We document strikingly asymmetric effects of mobile adoption across the two sides of the market. On the borrower side, mobile usage significantly reduces loan submission likelihood, primarily due to heightened cognitive resource constraints. Although average loan quality remains unchanged, the composition of submitted applications shifts, becoming more concentrated around medium-risk borrowers. On the lender side, mobile usage increases approval likelihood. Mechanism analyses show that mobile-induced cognitive constraints, combined with increased uncertainty in borrower-side information, encourage greater reliance on heuristic (System 1) processing, especially for mid-credit borrowers, for whom quality assessment is most ambiguous. A decomposition analysis further reveals that neither mobile usage nor altered information conditions alone affects approval criteria; rather, meaningful behavioral shifts emerge only when the two coincide. Further investigation into repayment and debt collection outcomes suggests that mobile adoption ultimately enhances lenders’ profits by facilitating faster borrower responses and lower default rates. Together, these results highlight a nuanced chain of effects through which mobile technologies reshape decision processes and outcomes in two-sided markets, offering implications for platform design, behavioral modeling, and digital financial governance.

Keywords: mobile adoption; cognitive load theory; credit risk management; peer-to-peer lending; two-sided behavior; field experiment