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Journal of the Association for Information Systems

Abstract

In crowdfunding, the disclosure of campaign details and progress is widely considered beneficial to fundraising because it can resolve information asymmetry and improve operational transparency. However, does this mean that fundraisers should frequently post updates? In this study, we aim to understand the implications of update frequency and content for fundraising in the context of medical crowdfunding. We deploy various natural language processing models to analyze the type, volume, and novelty of the information disclosed in updates and how funders perceive them. Our results delineate an inverted U-shaped relationship between update frequency and donations, contingent on content type. Specifically, we found that medical updates can resolve concerns and foster positive impressions among funders, which improves fundraising. However, as the update frequency increases, further posts may contribute to cognitive overload, attenuating the effect. In contrast, nonmedical updates are associated with a lower donation amount, as this type of update tends to contain redundant information and is negatively received by funders. This study contributes to crowdfunding literature by uncovering the unintended consequences of updates on fundraising due to reduced novelty and information overload. Our results suggest that theorizing the role of updates in medical crowdfunding needs to account for the two-sided nature of information disclosure. In particular, posting novel, issue-relevant information can initially reduce uncertainty and stimulate trust, positively influencing funding outcomes. However, overly frequent updates may include excessive details or repetitive content, adversely impacting fundraising.

DOI

10.17705/1jais.00939

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