Rethinking investors' herding behavior under the conditions of reward-based crowdfunding platform

Zhu, Zujun; Liu, Junzhe; Zhang, Mengru

doi:10.1108/imds-06-2022-0383

Cited by 3 publications

(4 citation statements)

References 63 publications

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“…Homophily studies the relationship between individual characteristics and the average characteristics of group members [4]. Similar phenomena, such as the "herding effect" [5,6], the "contagion effect" [7], and the "surge effect" [8], have been observed and explained. The presence of homophily within groups has been revealed through studies on interactions and mutual influences among individuals.…”

Section: Mechanisms Of Homophily In Information Disclosure Behaviormentioning

confidence: 88%

Empirical Analysis of the Impact of Top Management Team Social Networks on the Homophily Effect of ESG Disclosure in Companies

Zhang

Liu

2023

Sustainability

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This study investigates the homophily effect in corporate information disclosure, specifically focusing on executive social networks. We analyze data from 385 privately listed companies in China’s Growth Enterprise Market between 2018 and 2021. An OLS regression model is employed to examine the presence of a homophily effect in ESG information disclosure by private enterprises, along with regional and industry variations. Additionally, we utilize a moderation effect model to assess the influence of executive social networks on the homophily effect of ESG information disclosure. We conduct robustness tests based on our findings. The results indicate a significant homophily effect in ESG information disclosure by private enterprises, with varying magnitudes across regions and industries. Furthermore, executive social networks positively moderate the homophily effect, suggesting that a more diverse social network among the executive team enhances the homophily effect of ESG information disclosure for private enterprises. These findings offer valuable insights for corporate low-carbon sustainable development.

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Section: Mechanisms Of Homophily In Information Disclosure Behaviormentioning

confidence: 88%

Empirical Analysis of the Impact of Top Management Team Social Networks on the Homophily Effect of ESG Disclosure in Companies

Zhang

Liu

2023

Sustainability

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“…Regarding control variables, Zhu et al . (2022) proposed controlling basic attributes like funding goals, available days, and delivery days to analyze investor behavior.…”

Section: Methodsmentioning

confidence: 99%

“…Regarding control variables, Zhu et al (2022) proposed controlling basic attributes like funding goals, available days, and delivery days to analyze investor behavior. Considering the variations in project characteristics and research subjects, we chose the fundraising target amount and duration as control variables.…”

Section: Variable Settingsmentioning

confidence: 99%

Does transparency facilitate the fundraising capacity of public welfare crowdfunding? An empirical examination on Weibo

Liang,

Xie,

Ren

et al. 2024

IMDS

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PurposeInformation opacity in donation crowdfunding activities has constrained the healthy development of China’s public welfare activities. Addressing the trust crisis and enhancing public engagement warrants further investigation. This study aims to uncover the moderating effect of activity transparency by utilizing data from 1,029 donation crowdfunding projects on the Sina Weibo Public Welfare Social Platform. In this way, we seek to elucidate the impact of donation crowdfunding events on fundraising ability.Design/methodology/approachThis study selects text complexity, number of supporters, creator experience, and social capital as explanatory variables; innovatively selects the number of updates of online crowdfunding activities and total reading volume as moderating variables; selects the number of shares of crowdfunding activities as a mediating variable; and constructs a moderated mediation multiple regression model for fundraising ability.FindingsOur findings indicate that independent variables, such as text complexity, number of supporters, and social capital, can significantly affect the dependent variable, fundraising ability. However, creator experience does not influence fundraising ability. Furthermore, social interaction has a mediating effect, whereas activity transparency has a reverse moderating effect. These results indicate that social interaction can enhance the fundraising ability of donation crowdfunding events. However, with an increase in information transparency, the fundraising ability of social media decreases.Originality/valueThe originality of this research is in clarifying the internal factors affecting fundraising ability through induction, making bold assumptions, and focusing on how social media’s effective interaction and activity transparency will affect public welfare crowdfunding fundraising ability.

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“…While most prior studies focused on reward-based, donation-based and loan-based crowdfunding, relatively little has been done to understand the equity crowdfunding phenomenon (Ahlers et al ., 2015; Bapna, 2019; Bernstein et al ., 2017; Zhu et al ., 2022). Compared with other types of crowdfunding, equity crowdfunding exhibits significant differences.…”

Section: Literature Reviewmentioning

confidence: 99%

Understanding investor co-investment in a syndicate on equity crowdfunding platforms

Liu

2023

IMDS

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PurposeConsidering the unique characteristics of equity crowdfunding platforms including the removal of stringent structural barriers (e.g. lack of co-location), high visibility and traceability of investor characteristics, large pool of available investors and simplified transaction process, the authors aim to examine how the two most prevalent mechanisms (i.e. homophily and repeated ties) unfold in this context by incorporating the contextual characteristics. The authors theorize an inverted U-shaped relationship between leader-backer similarity and the likelihood of co-investment in a syndicate on equity crowdfunding platforms. In addition, a leader–backer dyad is more likely to form new syndicates if the students have more prior co-investment ties.Design/methodology/approachThe empirical study is based on data from the AngelList syndicate platform and a linear probability model (LPM) with fixed effects is adopted to estimate the syndicate formation.FindingsThe authors find that the similarity between a leader and a backer has an inverted U-shaped relationship with the leader and backer's likelihood of co-investment in a syndicate, which is different from the dominant homophily-based tie formation in venture capital (VC) syndicates and other digital platform contexts. Although equity crowdfunding platforms encourage the possibility of exploring new partners, investors are more likely to co-invest with others who have stronger prior ties.Originality/valueThis research theoretically contributes to the scant literature of equity crowdfunding syndicates by contextualizing two most prevalent mechanisms (i.e. homophily and repeated ties) driving tie formation in VC syndicates and digital platforms.

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Rethinking investors' herding behavior under the conditions of reward-based crowdfunding platform

Cited by 3 publications

References 63 publications

Empirical Analysis of the Impact of Top Management Team Social Networks on the Homophily Effect of ESG Disclosure in Companies

Empirical Analysis of the Impact of Top Management Team Social Networks on the Homophily Effect of ESG Disclosure in Companies

Does transparency facilitate the fundraising capacity of public welfare crowdfunding? An empirical examination on Weibo

Understanding investor co-investment in a syndicate on equity crowdfunding platforms

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