About This Project

Prior studies have shown existing crowdfunding platforms often lead to inefficient allocation of funds to projects. Our platform allows donors to express preferences of multiple projects and reallocate funds across the set of the donors’ preferred projects. Using our platform, we will help local schools raise funds and investigate whether crowdfunding platforms can encourage donors to express their true preferences.

Ask the Scientists

What is the context of this research?

Crowdfunding sites such as DonorsChoose, and GiveForward have been attracting increasing attention. Crowdfunding has been adopted by philanthropic organizations to attract charitable donations or to promote various humanitarian campaigns. For example, DonorsChoose - an educational crowdfunding platform -raised hundreds of millions of dollars to help children acquire educational resources. However, on existing crowdfunding platforms, prior studies have shown that this often leads to inefficient allocation of funds to projects. Our project proposes a new donation method allowing donors to express preferences regarding multiple projects, and implements these preferences by reallocating funds across the set of the donors’ favored projects.

What is the significance of this project?

Many studies show the process of matching donations to crowdfunding projects is not always efficient. Research has shown that the successes of crowdfunding campaigns are dependent on many factors in addition to their quality, such as their donations dynamics, social activities, or project updates before they reach the donation goals. These factors will likely lead to less efficient allocation of resources.

We will design a new crowdfunding system to improve the success rate and allow potential donors to express their true preferences with donating for high quality projects. It allows resources to be more efficiently allocated to the highest quality projects through crowdfunding. In other word, high quality projects would be promoted and easy to achieve donation goals.

What are the goals of the project?

This project investigates how crowdfunding platforms can utilize a simple algorithm to efficiently allocate of funding from multiple backers to multiple projects. It aims to balance between the donors' preferences of projects and how much money each of these projects need to reach their funding goals, such that high quality projects will most likely succeed. We focus on charitable donation crowdfunding, and donors in these platforms are primarily driven by altruistic motivation. We will conduct interviews with school teachers and donors to understand their motivation of using crowdfunding. After collecting those opinions, we may refine our platform, and we want to test it to understand to what extent the platform can increase the impact of donations from multiple backers