Jun 01, 2017
from 01:00 PM to 02:00 PM
|Where||Room W4.03, Cambridge Judge Business School|
|Contact Name||Kat Ndrepepaj|
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Katrin Tinn is an Assistant Professor in Finance at Imperial College, London.
Katrin's research focuses mainly on applied theory and her research interests include financial economics, rational expectations, economic growth, technological innovation, information imperfections in financial markets, relationship between equity markets and aggregate economy, trading incentives of financial institutions, asset market anomalies, international finance and trade, and the role of imperfect information in elections.
Title: “Learning Through Crowdfunding” (with Gilles Chemla)
Abstract: We develop a model where reward-based crowdfunding enables firms to obtain a reliable proof of concept early in their production cycle. The information gathered from a subsample of backers through a fixed length pre-selling campaign enables firms to update their beliefs about the preferences of all future consumers. This creates a valuable real option as firms invest only if updated demand is high. Further, such updating mitigates moral hazard: the higher the funds raised, the lower the firms' incentives to divert them. Our results are consistent with stylized facts and provide new testable implications.