Critical mass in a crowd: A predictive model of online crowdfunding of public goods in the U.S. vs. U.K

Abstract

Research on differences in public goods crowdfunding donation behavior among top-performing markets is scarce, particularly among countries that are often considered culturally similar overall but have differences that may affect crowdfunding donation behavior (e.g., the U.S. and U.K.). With addressing this gap in mind, we calculate the “critical mass” numbers for both markets using scraped data from major crowdfunding sites and advanced econometrics and analytics techniques. While fewer contributors are required for a U.S. crowdfunding campaign to “take off,” U.S. contributions decrease afterward. Meanwhile, U.K. participants follow the opposite pattern, contributing at a slower yet steadier pace over time, with more successful campaigns long term. Further, lower (higher) information efficiency leads to lower critical mass numbers, lower duration, and more donors for the U.S. (U.K.). The findings contribute to the literature on global crowdfunding by characterizing idiosyncrasies of the top two crowdfunding markets in donation behavior toward public goods campaigns.