The Trade-Offs in Promoting Equity-Focused Initiatives in Crowdfunding
Journal of the Association for Information Systems · 2025 · Volume 26 · Issue 2
Abstract
Organizations interested in supporting matters of diversity and equity need guidance on whether to be transparent about their equity-focused initiatives and appeal to users’ sense of social justice. This paper explores how information transparency affects backer responses to equity-related initiatives. The educational crowdfunding platform DonorsChoose launched an “equity-focused” initiative to highlight the platform’s commitment to equity in education and encourage donations towards that cause. Using an observational analysis and an experimental study, I found evidence that information transparency, i.e., explicitly promoting equity-focused projects, dampens overall donations because any change in donations associated with the equity-focused initiatives is insufficient to offset the decrease in other donations. However, I found evidence that distant donors are more responsive to equity-focused recommendations, consistent with the hypothesis that a holistic mindset moderates the effectiveness of promoting equity-focused initiatives. This study provides insight into the trade-offs associated with information transparency for equity-related initiatives and the complicated relationship between organizations and equity-related initiatives.
Keywords
Digital Platforms, Equity, Diversity, Inclusion, Field Experiment, Econometrics, Crowdfunding, Information Transparency
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