Abstract
The most pronounced risk that fund providers assume in rewards-based crowdfunding is reward delivery. Developing markets around the world exhibit geopolitical risks (GPR) that impact the likelihood that the rewards will be delivered. Hence, this points towards a potential association between GPR and the likelihood of successful crowdfunding financing. This paper examines 1,672 fundraising attempts from the 19 developing countries listed in the GPR index. The data indicate that GPR is negatively associated with the likelihood of crowdfunding success. Further, the evidence shows that entrepreneurs can moderate the costs of GPR via signaling and campaign disclosures. Implications for policymakers and entrepreneurs are discussed.
Original language | English |
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Article number | 101766 |
Number of pages | 17 |
Journal | Journal of International Financial Markets, Institutions and Money |
Volume | 85 |
Early online date | 5 Apr 2023 |
DOIs | |
Publication status | Published - 1 Jun 2023 |
Keywords
- Geopolitical risk
- Uncertainty
- Crowdfunding