Abstract

Prosocial crowdfunding, such as Kiva, puzzles researchers regarding what motivates online peers to lend for free, and how voluntary online participation could be organized to create great social goods. A common practice of prosocial lending websites is to enable self-organizing teams. In this paper, we are interested in the impact of team ranking, and thus team reputation on its lending performance. Contradicting predictions could be derived depending on the theoretical lenses. While social identity theory suggests that better ranking strengthens individual identification and promotes lending participation; economic theory on public goods indicates that good ranking may trigger a crowd-out effect. To empirically explore the relationship between team ranking and team performance, we collected data from Kiva, the largest prosocial crowdfunding platform. Kiva enables lenders to form teams, and teams are ranked monthly on both lending performance and member recruitment. Our data analysis suggests that appearance on the top ranking list leads to a reduction in future team lending indicating that good team-rank triggers the crowd-out effect. Meanwhile, salience on the member recruitment list does not show any significant impact on lending performance. Our finding suggests that team reputation may not promote identification in this context.

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