Crowdfunding with overenthusiastic investors: a global game model

Crowdfunding with overenthusiastic investors: a global game model

Aucun commentaire sur Crowdfunding with overenthusiastic investors: a global game model

Auteur :

 

Abstract

Crowdfunding platforms are providing funds to an increasing number of projects, among which many have a strong social/community impact. Under a all-or-nothing program, the success of the investment depends on the ability of a crowd of potential investors to put their funds into the project without an explicit coordination device. With heterogeneous information, such a problem can be analyzed as a typical global game. We assume that signals of at least some agents present a systematic positive bias, driven by positive emotions about projects with high social/community impact. The analysis reveals that if the number of such overenthusiastic persons is large enough, crowdfunding …nance might support …nancially inefficient projects. We then analyze how a monopolistic platform optimally determines transaction fees and unveil the relationship between overenthusiasm and the pro…t of the platform.

Keywords

Crowdfunding, entrepreneurship, global games, overenthusiasm, behavioral IO.

ADRESSE
45 rue des Saints Pères - 75006 Paris
TELEPHONE & MAIL
01 42 86 20 71 - liraes@parisdescartes.fr


logo_liraes

Back to Top