Time: May 11 (Wed.), 1:30 -3:00 pm (Beijing Time)

Title: The Sunshine Effects on Solar Loan Repayments

About the Speaker:

Yinghao Pan is joining the National Academy of Development and Strategy at the Renmin University of China as an Assistant Professor. He works on public economics, urban economics, and development economics. He obtained his Ph.D. from the National University of Singapore and his bachelor’s degrees in management and economics from the Renmin University of China.

Abstract:

Solar loans are increasingly used to promote residential solar photovoltaic expansion, but with concerns on its default rate. This paper studies the psychological effects of sunshine on borrowers’ repayment behaviors. Using administrative datasets from China, we show that borrowers are 20.8 percent less likely to be delinquent if the sunshine duration is one standard deviation longer in the week of the repayment deadline. The evidence is most consistent with behavioral bias that borrowers mispredict future revenue based on the current sunshine durations. We highlight the importance of psychological factors in renewable energy financing.