How Rewarding are Your Rewards? A Value-Based View of Crowdfunding Rewards and Crowdfunding Performance

Entrepreneurship Theory and Practice, Forthcoming

53 Pages Posted: 24 Jun 2020

See all articles by Han Jiang

Han Jiang

The Chinese University of Hong Kong, Shenzhen - School of Management and Economics

Zhiyi Wang

University of Colorado at Boulder - Leeds School of Business

Lusi Yang

Georgia State University - J. Mack Robinson College of Business

jia shen

affiliation not provided to SSRN

Jungpil Hahn

National University of Singapore (NUS) - Department of Information Systems and Analytics

Date Written: May 3, 2020

Abstract

In this study, we integrate the insights of consumption value theory and the crowdfunding literature to develop a value-based view of crowdfunding rewards to systematically theorize and synthesize the underlying mechanisms through which the various rewards offered by crowdfunding projects can incentivize crowdfunders’ backing decisions. Identifying three basic value dimensions carried by different crowdfunding rewards — utilitarian value, socioemotional value, and participatory value, our value-based view posits that these three values satisfy crowdfunders’ different needs and thus motivate them to back a project on distinct grounds and considerations. Through this view, the performance of a crowdfunding project can thus be shaped by the joint effects of the three values delivered by all of its offered rewards. Given their distinct incentivizing mechanisms, we further posit that socioemotional value and participatory value will potentially substitute the effects of utilitarian value, thus leading to an inverted U-shaped effect of the combination of the three values on crowdfunding performance. Evidence from a novel multimethod design that integrates field data, topic modeling, and a survey with crowdfunding professionals largely supports our theoretical predictions. Our theoretical framework and empirical findings have important implications for both theory and practice.

Keywords: Value-based view of crowdfunding rewards, consumption value theory, utilitarian value, socioemotional value, participatory value

Suggested Citation

Jiang, Han and Wang, Zhiyi and Yang, Lusi and shen, jia and Hahn, Jungpil, How Rewarding are Your Rewards? A Value-Based View of Crowdfunding Rewards and Crowdfunding Performance (May 3, 2020). Entrepreneurship Theory and Practice, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3591606

Han Jiang

The Chinese University of Hong Kong, Shenzhen - School of Management and Economics ( email )

2001 Longxiang Road, Longgang District
Shenzhen, 518172
China

Zhiyi Wang

University of Colorado at Boulder - Leeds School of Business ( email )

Boulder, CO 80309-0419
United States

Lusi Yang (Contact Author)

Georgia State University - J. Mack Robinson College of Business ( email )

P.O. Box 4050
Atlanta, GA 30303-3083
United States

Jia Shen

affiliation not provided to SSRN

Jungpil Hahn

National University of Singapore (NUS) - Department of Information Systems and Analytics ( email )

Singapore

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