Investor Protection and Crowdfunding

Century Corporate Governance for Crowdfunding and App-based Investor Communications

Investor Protection and Asset Pricing∗

Corporations in most countries are run by controlling shareholders, who have substantially smaller cash flow rights than their control rights in the firm. This separation of ownership and control allows the controlling shareholders to pursue private benefits at the cost of outside minority investors by diverting resources away from the firm and distorting corporate investment and payout policie...

An Interdisciplinary Review of Investor Decision-Making in Crowdfunding

Crowdfunding is a quickly expanding phenomenon that emerged as an alternative way to finance ventures or individuals about a decade ago. In crowdfunding, individuals or ventures use online platforms to collect funds from a relatively large group of investors [1]. Today, it provides increasing competition for traditional financing agents such as venture capitalists (VCs), business angels (BAs), ...

The Effect of Investor Protection

This paper tests the hypotheses that poor investor-protection environments lead to higher information asymmetry in security markets. We compare China-based stocks, which operate in a relatively unprotected environment, to Hong Kong-based stocks. The information component in the market friction of China stocks is shown to be up to 20% larger than that of Hong Kong-based stocks. The effect is rob...

The Politics of Investor Protection and Competition

External finance is critical for less established entrepreneurs, so poor investor protection can hinder competition. We model how lobbying for weaker investor protection reduces access to finance and decreases competition in countries where politicians are less accountable to voters. Weaker accountability thus produces a smaller economic elite. As empirical support for this result, in a broad p...