What social issues do people invest in? An examination based on the empathy–altruism hypothesis of prosocial crowdfunding platforms

Abstract

This study aims to elucidate the effects of a prosocial orientation on investments in entrepreneurial businesses through crowdfunding platforms. By drawing on the theory of empathy in social psychology, we focused on social issues that campaigns address, rather than the rhetoric and narratives used in campaigns. We applied a topic modeling method to identify types of social issues expressed in campaign documents. Furthermore, we conducted a questionnaire survey to measure the degree of empathic feeling about social issues. The results revealed that high levels of empathy to social issues do not directly lead to supporting behavior, and in particular, high levels of emotional empathy suppress the effects of cognitive empathy. Instead, backers are more likely to invest in campaigns that address social issues that evoke cognitive empathy and that are perceived to be a viable business.