Aiming for the Goal: Contribution Dynamics of Crowdfunding

Joyee Deb, Aniko Oery and Kevin Williams
Authors registered in the RePEc Author Service: Aniko Öry

No 25881, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study a dynamic contribution game where investors seek private benefits that are offered in exchange for contributions and a single, publicly-minded donor values project success. We show that donor contributions serve as costly signals that encourage socially-productive contributions by investors who face a coordination problem. Investors and the donor prefer different equilibria but all benefit in expectation from the donor’s ability to dynamically signal his valuation. We explore various contexts in which our model can be applied and delve empirically into the case of Kickstarter. We calibrate our model and quantify the coordination benefits of dynamic signaling in counterfactuals.

JEL-codes: D21 D22 D26 D7 D8 (search for similar items in EconPapers)
Date: 2019-05
New Economics Papers: this item is included in nep-gth, nep-mic and nep-pay
Note: IO
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Citations: View citations in EconPapers (5)

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Related works:
Working Paper: Aiming for the Goal: Contribution Dynamics of Crowdfunding (2021)
Working Paper: Aiming for the Goal: Contribution Dynamics of Crowdfunding (2018)
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