Attention Across Borders: Investor Attention as a Driver of Investment Choices in Cross-Border Equity Crowdfunding
57 Pages Posted: 1 Dec 2019
Date Written: November 15, 2019
Equity crowdfunding is an increasingly international form of digital platform-based entrepreneurial finance. With an unprecedented number of available international investment opportunities, it becomes relevant to ask what leads cross-border investors to invest in certain campaigns and not others. Building on attention literature, we theorize how investor attention drives cross-border investors’ investment choices. We test our hypotheses using a unique dataset of cross-border equity crowdfunding investments. We find that investor attention, as proxied by campaign visibility in investor countries and entrepreneur-investor co-nationality, has strong positive effects on cross-border investment tie formation, whereas national distances lose their importance in this digital setting.
Keywords: cross-border investments, equity crowdfunding, digital platforms, attention, co-nationality, national distances
JEL Classification: M13, G24, F20
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