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Avoiding Peer Information and Its Effects on Charity Crowdfunding: A Field Experiment

Author

Listed:
  • Tat Y. Chan

    (Olin Business School, Washington University, St. Louis, Missouri 63117)

  • Li Liao

    (People’s Bank of China School of Finance (PBCSF), Tsinghua University, Beijing 100083, China)

  • Xiumin Martin

    (Olin Business School, Washington University, St. Louis, Missouri 63117)

  • Zhengwei Wang

    (People’s Bank of China School of Finance (PBCSF), Tsinghua University, Beijing 100083, China)

Abstract

We study the behavior of an individual avoiding peer information from a natural field experiment of charity crowdfunding. The unique experimental design enables us to employ an instrumental variable strategy to identify how the behavior influences individual giving to and promotion of charity campaigns. We find that, even with free access, 89% of individuals chose not to seek peer information. These individuals were less likely, whereas their peers were more likely to give and help promote in the past. The behavior would reduce the total distribution of campaigns by 8.5% and the total donation amount by 7.7%. A stylized model is used to illustrate how the pressure from peer comparison drives the individuals not to seek the information and how this behavior could influence giving and promoting behaviors of a group of marginal individuals.

Suggested Citation

  • Tat Y. Chan & Li Liao & Xiumin Martin & Zhengwei Wang, 2024. "Avoiding Peer Information and Its Effects on Charity Crowdfunding: A Field Experiment," Management Science, INFORMS, vol. 70(4), pages 2272-2293, April.
    • Handle: RePEc:inm:ormnsc:v:70:y:2024:i:4:p:2272-2293
    DOI: 10.1287/mnsc.2023.4807
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    References listed on IDEAS

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    Cited by:

    1. Wu, Zhibin & Li, Yueyuan & Pedrycz, Witold, 2026. "Peer influence in social network: a review of identification, modeling and application," Journal of Business Research, Elsevier, vol. 203(C).

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