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Institute
CROWDFUNDING PLATFORMS HAVE BECOME A VALUABLE ALTERNATIVE TO TRADITIONAL SOURCES OF FINANCING. HOWEVER, SOME PHENOMENA ON CROWDFUN DING PLATFORMS CAUSE UNDESIRABLE EXTERNAL EFFECTS THAT CAN ADVERSELY INFLUENCE THE FUNDING SUCCESS OF PROJECTS. ONE SUCH PHENOMENON IS PROJECT OVERFUNDING. IN ORDER TO INTERNALIZE THE EXTERNALITIES OF OVER FUNDING, WE PROPOSE A FUNDING REDISTRIBUTION APPROACH FOR IMPROVING OVERALL FUNDING RESULTS. TO EVALUATE THIS CONCEPT, WE DEVELOP AND DEPLOY AN AGENT-BASED MODEL.
THE FINANCIAL INDUSTRY HAS EXPERIENCED A CONTINUOUS EVOLUTION IN SERVICE DELIVERY DUE TO DIGITALIZATION. THIS CHANGE MANIFESTS ITSELF IN EXPANDED CONNECTIVITY, ENHANCED SPEED OF INFORMATION PROCESSING, A MULTITUDE OF NEW FINANCIAL PRODUCTS, AND NOVEL FORMS OF CUSTOMER INTERACTION. AGAINST THIS BACKDROP, ACADEMIC RESEARCH HAS ANALYZED THE IMPACT OF DIGITALPROGRESS IN THE FINANCIAL SECTOR. IN ORDER TO PROVIDE AN OVERVIEW ON THIS RESEARCH AND TO IDENTIFY POSSIBLE GAPS, WE HAVE REVIEWED THE RELEVANT LITERATURE IN THIS FIELD APPLYING A SYSTEMATIC AND COMPREHENSIVE SEARCH.
Crowdfunding platforms offer project initiators the opportunity to acquire funds from the Internet crowd and, therefore, have become a valuable alternative to traditional sources of funding. However, some processes on crowdfunding platforms cause undesirable external effects that influence the funding success of projects. In this context, we focus on the phenomenon of project overfunding. Massively overfunded projects have been discussed to overshadow other crowdfunding projects which in turn receive less funding. We propose a funding redistribution mechanism to internalize these overfunding externalities and to improve overall funding results. To evaluate this concept, we develop and deploy an agent-based model (ABM). This ABM is based on a multi-attribute decision-making approach and is suitable to simulate the dynamic funding processes on a crowdfunding platform. Our evaluation provides evidence that possible modifications of the crowdfunding mechanisms bear the chance to optimize funding results and to alleviate existing flaws.