Institutional background in crowdfunding: trust, signals, and backers’ decisions
(2026) Small Business Economics : an entrepreneurship journal — Vol. -, p. - (2026)
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- Abstract
- We propose that institutional backgrounds derived from the project location and the entrepreneur's country-of-origin act as heuristic cues that facilitate swift trust judgment, and therefore, influence international, digital exchange decisions. Using a dataset of 101,583 Kickstarter campaigns, we find that stronger institutional environments linked to the project and the entrepreneur positively affect backers' participation. Moreover, the two institutional cues can compensate for one another. We also show that stronger institutional background of the project (yet not the entrepreneur) enhances low-cost signals' credibility; and in the presence of some high-cost signals, institutional background (of the entrepreneur in particular) is less consequential.
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Citations
Shrestha, P., Collewaert, V., & Thewissen, J. (2026). Institutional background in crowdfunding: trust, signals, and backers’ decisions. Small Business Economics : an entrepreneurship journal, -, -. https://doi.org/10.1007/s11187-026-01209-4 (Original work published 2026)