6533b82efe1ef96bd1293b9d

RESEARCH PRODUCT

CROWDFUNDING AND INNOVATION

Fabrice HervéArmin Schwienbacher

subject

Economics and Econometricsbusiness.industry05 social sciencesInnovation processCrowdsourcingEntrepreneurial financeContent analysisCapital (economics)0502 economics and businessNew product developmentEconomicsProduct (category theory)050207 economicsbusiness050203 business & managementIndustrial organization

description

Entrepreneurs have started relying on crowdfunding to fund their investments. This paper surveys the literature linking crowdfunding with innovation in entrepreneurial firms. Two distinct areas are discussed. First, crowdfunding has the potential to foster innovation by offering new sources of capital to innovation‐driven firms and thereby reduce the funding gap for innovative startups. Second, crowdfunding offers a way for the crowd to participate in the innovation process by providing feedback to the entrepreneur. This feedback can take various forms, including providing ideas on the development of the product during and after the campaign (in the spirit of crowdsourcing), and providing valuable information on the future demand for the new product.

yearjournalcountryeditionlanguage
2018-07-03Journal of Economic Surveys
https://doi.org/10.1111/joes.12274