Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/74657
Authors: 
Mäschle, Oliver
Year of Publication: 
2012
Series/Report no.: 
Thünen-Series of Applied Economic Theory 126
Abstract: 
On crowdinvesting-platforms, non-publicly traded companies can offer equity to private investors. Currently, platforms like Crowdcube.com in Great Britain or Seedmatch.de in Germany are using a mechanism for the allocation of available shares best described by the phrase first come, first served. This paper argues that this kind of allocation of shares or rationing of excessive demand is not optimal. It describes the characteristics that rationing of excessive demand has to imply to protect the interests of involved parties in an appropriate manner. A recommendation for a concrete practical implementation is offered as well.
Subjects: 
crowdinvesting
market microstructure
rationing
equity
underpricing
excessive demand
JEL: 
D40
D45
G21
G32
L10
Document Type: 
Working Paper

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