What’s in a “Username”? The Effect of Perceived Anonymity on Herding in Crowdfunding
Information Systems Research, 33(1), pp. 1-17, 2022
40 Pages Posted: 6 Aug 2019 Last revised: 23 Mar 2022
Date Written: March 22, 2022
This research examines the role of perceived anonymity in shaping herding behavior in crowdfunding markets. Drawing on theories from social psychology literature, we argue that a lender forms different credibility perceptions toward preceding peers based on their perceived anonymity state; she then uses such perceptions to adjust her herding momentum toward them. Using a unique data set collected from a leading debt-based crowdfunding platform, we classify individuals’ usernames as either anonymous or real-seeming, with the latter referring to a username that seems to reveal one’s legal name. The results show that successors demonstrate weaker herding momentum toward predecessors who are presented with real-seeming usernames than anonymous ones. This finding, which we attribute to a lower extent of perceived credibility derives from a non-conforming behavior, challenges the conventional wisdom that considers anonymity a negative factor for source credibility. We further show that the uncovered positive effect of perceived anonymity on herding is accentuated in the early stage of the fundraising period; nevertheless, we find no such discrepancies between listings that are assigned with high-risk and low-risk credit grades. Our study contributes to the literatures dealing with anonymity and herding in online environments.
Keywords: crowdfunding; herding; observational learning; anonymity; privacy; source credibility
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