Crowdfunding and the Democratization of Access to Capital-An Illusion? Evidence from Housing Prices

• 成果类型: Article
• 署名作者: Kim, Keongtae; Hann, Il-Horn
• 署名单位: Chinese University of Hong Kong; University System of Maryland; University of Maryland College Park
• 刊物名称: INFORMATION SYSTEMS RESEARCH
• ISSN/ISSBN: 1047-7047
• DOI: 10.1287/isre.2018.0802
• 发表日期: 2019
• 页码: 276-290
• 关键词: digital divide; determinants; geography; networks

摘要

Access to finance is arguably one of the most critical challenges in starting a new business. In this study, we examine how the difficulty of obtaining bank loans based on housing collateral, which is a form of traditional finance, relates to crowdfunding use by entrepreneurs. We obtained data on housing prices related closely to the cost of accessing such bank loans and matched these data to a 2009-2013 novel data set from a leading crowdfunding market. We adopted the first-difference estimator to address unobserved area-specific effects and used housing supply elasticity as an instrument for housing price changes. We found an increased decline in housing prices leads to a significant increase in the creation of crowdfunding projects. However, we did not find significant differential effects in housing price changes between successful and unsuccessful projects. Finally, the effect of housing prices on crowdfunding projects was more significant for areas with low socioeconomic status. Interestingly, the increase in crowdfunding projects in these low-status areas was driven wholly by a significant increase in unsuccessful projects, whereas the effect of housing prices on successful projects was significant only in areas of high socioeconomic status. Numerous additional tests support the robustness of our main findings. Overall, our study suggests that crowdfunding can supplement traditional sources of funding although socioeconomic status may still prevent disadvantaged people from receiving its full benefits.