 The role of information signals in determining crowdfunding outcomesJin-Hyuk Kim, Peter Newberry and Calvin Qiu Journal of Empirical Finance, 2022, vol. 67, issue C, 168-181 Abstract: Crowdfunding platforms often display information signals about the funding activity of a project throughout the fundraising campaign. We assess the impact of two of these signals, the progress towards the project’s funding goal and the current number of backers, on project-level funding outcomes. Estimating a discrete-choice model of backer behavior and then conducting simulations under alternative information regimes, we find that, for both content-oriented (Film, Music, and Publishing) and product-oriented (Games, Technology, and Design) projects, the number of backers increases with the funding status and the backer volume. The difference between the two project types is that the number of backers decreases for content-oriented projects that have already reached their funding goal, while product-oriented projects see an increase in the number of backers after reaching the goal. Because of this, displaying the funding status information decreases (increases) the number of product (content)-oriented projects that are successfully funded. Keywords: Crowdfunding; Information; Herding; Platform (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:empfin:v:67:y:2022:i:c:p:168-181 DOI: 10.1016/j.jempfin.2022.03.006 Access Statistics for this article Journal of Empirical Finance is currently edited by R. T. Baillie, F. C. Palm, Th. J. Vermaelen and C. C. P. Wolff More articles in Journal of Empirical Finance from Elsevier |
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