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The More, the Merrier? The Bystander Effect on Crowdfunding Platforms

from the project creator’s original expectation (“Target Pledge Amount”). We calculated
the days between the funding start date and end date to get the data of project duration.
When we clicked the name of the project creator, the Internet browser directed us to the
“About me” page of the project creator. This step enabled us to verify whether the project

was initiated by a single person, an entrepreneurial team, or an existing organization.
To ensure the accuracy of daily observations hand-coded from the flyingV
platform, we double-checked the sum of daily numbers against funding amounts and the

total number of backers on the flyingV platform. We also interviewed flyingV staff to
confirm our data collection process. Our final sample consisted of 5,773 funding efforts
representing NT$75.2 Million of pledges, of which 100 out of 191 projects (52.3%)
succeeded in reaching their funding goals.
According to flyingV, in 2014, 78,688 funding efforts represented NT$115 Million

of pledges, of which 238 out of 523 projects (45.5%) succeeded in reaching their funding
goals. No significant differences in success rates exist between our sample period and all
of 2014, thus suggesting that our data should be representative of the funding efforts on

the flyingV platform.

3.2 Variable Measurements
3.2.1 Dependent Variable
Our dependent variable pledge amount refers to the project pledge amount for each

day, i.e., the total amount that a crowdfunding project received at the end of each day. To
reduce the skewness of this value, we take the logarithm of the monetary value of the daily
pledge amount.

3.2.2 Explanatory Variables
We use bystander ratio as our explanatory variable, which is computed as the
number of bystanders divided by the number of supporters for each day. The flyingV
platform provides information about the number of supporters and backers. The number

of bystanders is given by the difference between the numbers of supporters and backers.
A higher ratio indicates that fewer people have pledged, but there are more bystanders. To
alleviate concerns about reverse causality, this variable is lagged by one day.

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