Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/287021 
Year of Publication: 
2021
Citation: 
[Journal:] Review of Managerial Science [ISSN:] 1863-6691 [Volume:] 15 [Issue:] 8 [Publisher:] Springer [Place:] Berlin, Heidelberg [Year:] 2021 [Pages:] 2501-2533
Publisher: 
Springer, Berlin, Heidelberg
Abstract: 
This study examines drivers of investment probability in equity-based crowdfunding using a hand-collected and comprehensive data set from a well-established platform. The analysis confirms several effects that have been reported in the recent literature on other crowdfunding markets. Extending recent research, we study moderators of local preferences of investors. Novel to the literature, we find that (1) local preferences are more pronounced in campaigns of younger ventures, (2) herding-like behaviour is stronger in local campaigns and (3) local investors are more responsive to updates posted by entrepreneurs, compared to non-locals. Our results suggest that investors allocate more attention to campaigns for which they have information advantages, such as local campaigns, due to their limited capacity to process information. Such behaviour may eventually amplify information asymmetry and local preferences. Our findings have practical implications for entrepreneurs, investors and platforms.
Subjects: 
Individual investor behaviour
Local preferences
Attention allocation
Limited information processing capacity
Equity-based crowdfunding
JEL: 
D83
G11
L26
M13
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.