Based on theories of herding behaviour and information cascade, this paper investigates features that affect retail investors’ willingness to invest in equity crowdfunding. This study assumes that investors can update their choice set by observing different sources of information, following an information cascade, in line with theories of signals and bounded rationality in decision-making under uncertainty. An online survey containing a discrete choice experiment was administered to 202 participants to investigate whether and how much they assume a herd behaviour and follow an information cascade to undertake investment decisions. To the best of our knowledge, this paper is the first to examine the empirical hierarchy of the sources of the information cascade. Our experimental evidence seems to indicate that retail investors observe and imitate the behavior of those investors who have shown effective financial involvement in the project, be they institutional investors or other retail investors. The hierarchy that emerges for the information sources used by the investors in ECF appears ordered, therefore, according to a cascade that demonstrates a rationality, albeit limited, of their behavior, conditioned by the investors who are objectively more informed about the risk / return expected from the project. The nature of the information primarily observed in ECF investment choices represents a value to be known and exploited both by innovative entrepreneurs looking for capital and by intermediaries operating in this segment of the financial industry.
Questo lavoro si inserisce negli studi dell’effetto herding e delle cascate informative, osservando, grazie a un esperimento di scelta, le decisioni d’investimento di 202 investitori retail nel contesto dell’Equity CrowdFunding (Ecf). Qui assumiamo che questi investitori perfezionano il proprio quadro decisionale attraverso l’apprendimento derivante da sorgenti d’informazione differenti, nell’ambito delle teorie dei segnali e di razionalità limitata nelle scelte in condizioni di incertezza. A quanto risulta dalla letteratura esistente, questo paper è il primo che tenta di ricostruire quale sia l’ordinamento reale delle sorgenti informative, verificando empiricamente la gerarchia delle fonti che condizionano maggiormente la disponibilità a investire (willingness-to-invest). Le nostre evidenze sperimentali sembrano indicare che gli investitori retail osservano e imitanoil comportamento di quegli investitori che hanno mostrato reale coinvolgimento finanziario nel progetto, siano essi investitori istituzionali o altri investitori retail. La gerarchia che emerge per le sorgenti informative impiegate dagli investitori in Ecf appare ordinata, nel suo complesso, seguendo una cascata informativa che dimostra una razionalità, seppur limitata, dei loro comportamenti, condizionati dagli investitori oggettivamente più informati sul rischio/rendimento attesi dal progetto finanziato. La natura delle informazioni seguite prioritariamente nelle scelte di investimento in Ecf rappresenta un valore da conoscere e valorizzare sia da parte degli imprenditori innovativi alla ricerca di capitali, sia da parte degli intermediari che operano in questo segmento dell’industria finanziaria.
La cascata informativa nell’Equity Crowdfunding: la razionalità (limitata) degli investitori retail / Lucarelli, Caterina; Mazzocchini, Francesco James. - In: BANCARIA. - ISSN 0005-4623. - STAMPA. - 2022:3(2022).
La cascata informativa nell’Equity Crowdfunding: la razionalità (limitata) degli investitori retail
Caterina Lucarelli
Primo
;Francesco James MazzocchiniSecondo
2022-01-01
Abstract
Based on theories of herding behaviour and information cascade, this paper investigates features that affect retail investors’ willingness to invest in equity crowdfunding. This study assumes that investors can update their choice set by observing different sources of information, following an information cascade, in line with theories of signals and bounded rationality in decision-making under uncertainty. An online survey containing a discrete choice experiment was administered to 202 participants to investigate whether and how much they assume a herd behaviour and follow an information cascade to undertake investment decisions. To the best of our knowledge, this paper is the first to examine the empirical hierarchy of the sources of the information cascade. Our experimental evidence seems to indicate that retail investors observe and imitate the behavior of those investors who have shown effective financial involvement in the project, be they institutional investors or other retail investors. The hierarchy that emerges for the information sources used by the investors in ECF appears ordered, therefore, according to a cascade that demonstrates a rationality, albeit limited, of their behavior, conditioned by the investors who are objectively more informed about the risk / return expected from the project. The nature of the information primarily observed in ECF investment choices represents a value to be known and exploited both by innovative entrepreneurs looking for capital and by intermediaries operating in this segment of the financial industry.File | Dimensione | Formato | |
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