A comparative study on crowdfunding in the United States and the United Kingdom

Chu, Duyen Dai

doi:10.25506/lemp11201729

Cited by 1 publication

(3 citation statements)

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“…This continues to change people's way of living and job patterns across communities, contributing to diverse management styles and organizational frameworks (Westwood and Everett 1987). Cultural variations in these two markets have been identified from previous empirical studies associated with backers' decision-making in any particular project and determining project success factors in the crowdfunding market (Zheng et al 2014;Cho and Kim 2017;Chu 2017). Furthermore, these authors concluded that cultural disparities could partially explain the gap between the United Kingdom and Chinese crowdfunding markets and, more specifically, according to Zheng et al (2014), the success of crowdfunding is influenced by culture.…”

Section: Cultural Differences Between China and Ukmentioning

confidence: 99%

“…We used and selected data from both Dreamore (China) and Crowdfunder (UK) crowdfunding platforms for cross-comparison. These reward-based crowdfunding platforms from each of the two countries are well-known, widespread and are actively used (Chu 2017;Wang et al 2018). Both platforms are generalist platforms, as they accept campaigns from diverse areas and work in line with an All-or-nothing (AON) model.…”

Section: Data Collectionmentioning

confidence: 99%

“…By considering this and to the best of our knowledge, the current study is one of the first to investigate the importance of signaling in project success and its role in mitigating the problem of information asymmetry in the crowdfunding market from the perspective of two important economies: China and the United Kingdom. A limited number of studies have examined crowdfunding success and market development in the context of a cross-country analysis (Zheng et al 2014;Cho and Kim 2017;Chu 2017;Bao and Huang 2017;Ashta 2018). Hence, this paper takes an initial attempt at exploring signaling dynamics and as a result, it enriches the prevailing literature related to crowdfunding in the context of diverse economies.…”

Section: Theoretical and Practical Implicationsmentioning

confidence: 99%

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The Effect and Impact of Signals on Investing Decisions in Reward-Based Crowdfunding: A Comparative Study of China and the United Kingdom

Usman

Bukhari

You

et al. 2020

JRFM

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When traditional financial institutions faced difficulties in the task of assisting micro, small and medium-sized enterprises (MSMEs) with capital allocations, crowdfunding can upsurge as an innovative and vibrant vehicle that can support and assist the activity of such MSME’s, by financing their activity and instrumenting the process of risk-sharing. Simultaneously with its enormous growth and popularity, crowdfunding is faced by several key challenges, one of biggest such challenges referring to the problem of information asymmetry that can exist between fundraisers and potential backers. Based on the signaling theory, a research taxonomy has been developed for a comparative analysis between China and the UK. This has been accomplished by retrieving secondary data from the following crowdfunding platforms: Dreamore (Chinese platform) and Crowdfunder (UK platform). The objective of the study is to investigate both the effect and the impact that signals (goal setting, project comments and updates) have upon mitigating the problem of information asymmetry, in order to make the project successful. We have thus deployed an Ordinary Least Square (OLS) regression and validated the models through a robustness check. The findings reveal that signals actively mitigate the problem of information asymmetry in both countries, but this varies in the sense that higher goal setting has a more positive/impactful relationship with project success in the UK than it does in China. Project comments are more positively associated with project success in China as compared to the UK, whereas project updates are more negatively related to project success in China as compared to the UK. These findings demonstrate the importance that signals have upon successful crowdfunding activities/campaigns, highlighting the theoretical and practical influence and relevance for potential fundraisers in the two aforementioned economies.

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