Exploring the determinants of fundraisers’ voluntary information disclosure on crowdfunding platforms. A risk-perception perspective
| Published date | 11 June 2018 |
| Pages | 324-342 |
| Date | 11 June 2018 |
| DOI | https://doi.org/10.1108/OIR-11-2016-0329 |
| Author | Tao Wang,Xiaowei Liu,Minghui Kang,Haichao Zheng |
| Subject Matter | Library & information science,Information behaviour & retrieval,Collection building & management,Bibliometrics,Databases,Information & knowledge management,Information & communications technology,Internet,Records management & preservation,Document management |
Exploring the determinants of
fundraisers’voluntary
information disclosure on
crowdfunding platforms
A risk-perception perspective
Tao Wang and Xiaowei Liu
School of Economic Information Engineering,
Southwestern University of Finance and Economics, Chengdu, China
Minghui Kang
School of Economics and Management,
Southwest Jiaotong University, Chengdu, China, and
Haichao Zheng
School of Economic Information Engineering,
Southwestern University of Finance and Economics, Chengdu, China
Abstract
Purpose –The purpose of this paper is to examine factors affecting fundraisers’voluntary information
disclosure on crowdfunding platforms based on risk-perception theory (RPT).
Design/methodology/approach –Structural equation modeling was employed to test the hypothesized
relationships using data collected from China.
Findings –The authors found that plagiarism risk and financing risk are two important variables that influence
fundraisers’voluntary information disclosure. Specifically, plagiarism risk has a negative effect on fundraisers’
voluntary information disclosure, while financing risk has a positive effect on fundraisers’voluntary information
disclosure. Plagiarism risk is affected by information concerns, perceived control, project innovativeness, and
quality of alternatives, while financing risk is affected by protection policy and information norms.
Originality/value –This study enriches crowdfunding research by identifying factors influencing fundraisers’
voluntary information disclosure and contributes to RPT by applying it in a new crowdfunding context.
Keywords Crowdfunding, Fundraiser, Risk-perception theory, Voluntary information disclosure
Paper type Research paper
Introduction
With the rapid growth of internet finance, crowdfunding is currently playing an
increasingly important role in financing (Mollick, 2014). It provides support for start-ups or
other newly generated projects, such as games, new products, etc. (Moritz et al., 2015)
and results in great profit for investors (Ahlers et al., 2015). Despite crowdfunding’s
many advantages (Li et al., 2016), there is still a large group of investors that refuses to
invest in crowdfunding projects. One major reason is information asymmetry between
fundraisers and potential investors (Moritz et al., 2015). Information asymmetry not only
damages potential investors’interests (Mollick, 2014) but also decreases the probability of a
project’s funding success (Ahlers et al., 2015). Studies have revealed that sufficient
information disclosure can increase the probability of successful funding and the confidence
Online Information Review
Vol. 42 No. 3, 2018
pp. 324-342
© Emerald PublishingLimited
1468-4527
DOI 10.1108/OIR-11-2016-0329
Received 22 November 2016
Revised 6 October 2017
Accepted 11 October 2017
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1468-4527.htm
This work has been supported by the National Natural Science Foundation of China (71502145, 71702155),
the Fundamental Research Funds for the Central Universities (Nos JBK1801043, JBK120505), and the Key
Laboratory of Financial Intelligence and Financial Engineering of Sichuan Province.
324
OIR
42,3
of investors (Li et al., 2016). Therefore, fundraisers are expected to provide enough
information to help them attract more investment from investors (Moritz et al., 2015).
However, there are few studies focusing on which factors affect fundraisers’information
disclosure on crowdfunding platforms, and very little is known regarding what
measures should be taken by crowdfunding practitioners or service providers to diminish
the information asymmetry between crowdfunding participants. Insufficient research on
information disclosure has become a major obstacle to the sustainable development of
crowdfunding (Li et al., 2016). The high practical relevance and dearth of research indicate
the importance of the present study. Crowdfunding information disclosure consists of
mandatory information disclosure and voluntary information disclosure (Gallego-Álvarez
et al., 2008; Gallego-Álvarez and Quina-Custodio, 2016). Mandatory information disclosure is
primarily determined by government policy or industry regulations and a lack of
managerial flexibility (Zhang, 2015). For this reason, we focus only on voluntary
information disclosure in this paper.
This paper has two main objectives. First, drawing on the existing literature, we identify
potential factors underlying fundraisers’voluntary information disclosure and suggest a
risk-perception model that involves individual and contextual factors to understand
fundraisers’voluntary information disclosure behavior. Second, because different types of
risk appear when fundraisers disclose information about their projects on crowdfunding
platforms, we further classify risk perceptions into two dimensions: plagiarism risk and
financing risk. This study examines how the two types of perceived risk transmit the effect
of antecedents to voluntary information disclosure. To achieve these two objectives,
a literature review was conducted to examine the constructs identified in our research
model. Research on voluntary information disclosure in the context of crowdfunding is still
at a preliminary stage, and few empirically validated studies on fundraisers’voluntary
information disclosure exist. Therefore, an extended range of relevant studies were
reviewed, including literature on crowdfunding and risk-perception theory (RPT). RPT was
applied as the basic theoretical foundation on which to build our theoretical framework.
To test the model, structural equation modeling (SEM) was employed to analyze data
collected from 411 respondents in China. SEM is a popular method in social science
research and is applicable to models with multiple causes, multiple results, and
unobservable variables (Kline, 2016). This study is expected to be of substantial interest to
both academics and practitioners. Academically, this paper not only makes contributions
to crowdfunding research but also supplements the IS literature in RPT. Practically,
the findings offer new insight for crowdfunding platform operators seeking to devise more
effective risk-reducing strategies, which can encourage fundraisers to voluntarily disclose
more information about their projects to meet investors’requirements. The findings may
also be used to guide managers or executives in formulating and executing crowdfunding
information disclosure regulation, which should decrease information asymmetry and
promote the proliferation of crowdfunding.
Literature review
Crowdfunding
Crowdfunding has emerged as an alternative source of funding for various types of projects
and as one of the most important branches of global internet finance (Li et al., 2016). In a
typical crowdfunding campaign, the initiators describe their project, choose a funding
mechanism and set a funding goal and a price each backer pays, as well as the reward each
backer obtains (Mollick, 2014). In terms of investor return, crowdfunding encompasses four
forms –equity-based, reward-based, lending-based, and donation-based services
(Ahlers et al., 2015) –with equity-based and reward-based crowdfunding accumulating
the dominant market share compared to the other forms.
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Fundraisers’
voluntary
information
disclosure
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