TY  - JOUR
A1  - Faust, Luisa
A1  - Kolbe, Maura
A1  - Mansouri, Sasan
A1  - Momtaz, Paul
T1  - The crowdfunding of altruism
T2  - Journal of risk and financial management
N2  - This paper introduces a machine learning approach to quantify altruism from the linguistic style of textual documents. We apply our method to a central question in (social) entrepreneurship: How does altruism impact entrepreneurial success? Specifically, we examine the effects of altruism on crowdfunding outcomes in Initial Coin Offerings (ICOs). The main result suggests that altruism and ICO firm valuation are negatively related. We, then, explore several channels to shed some light on whether the negative altruism-valuation relation is causal. Our findings suggest that it is not altruism that causes lower firm valuation; rather, low-quality entrepreneurs select into altruistic projects, while the marginal effect of altruism on high-quality entrepreneurs is actually positive. Altruism increases the funding amount in ICOs in the presence of high-quality projects, low asymmetric information, and strong corporate governance.
KW  - altruism
KW  - machine learning
KW  - crowdfunding
KW  - token offerings
KW  - Initial Coin Offering
KW  - entrepreneurial finance
Y1  - 2022
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/82798
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-827987
VL  - 15
IS  - 3, art. 138
SP  - 1
EP  - 29
PB  - MDPI
CY  - Basel
ER  -