Do small funding amounts lead to reverse herding? A field experiment in reward-based crowdfunding

Several biases are known to influence funding decisions in crowdfunding. Among these biases is herding behavior; that is, the tendency to imitate the funding decisions of others. Herding is a very robust phenomenon in crowdfunding and uniformly characterized as a positive reinforcement effect. We challenge this characterization and ask whether the funding decisions of others may in fact have a negative effect and lead to a reduction of follow-up...