Investigating potential backers' reactions to fundraiser misconduct in crowdfunding: a psychological reactance...

Crowdfunding has emerged as an alternative way of financing for both commercial and non-commercial purposes. While fundraisers enjoy enhanced financing accessibility, agility, and real time feedback from the market, financing health is challenged by fundraisers' misconduct such as fraudulent claim, wealth flaunting, and fund abuse. The voluntary nature of crowdfunding amplifies individual reactions to misconduct, offering a critical lens for examining how aggregated psychological reactance shapes collective decisions. This study attempts to explain potential backers' reactions to fundraiser misconduct in a crowdfunding project through the theoretical lens of psychological reactance. Building upon psychological reactance theory, the intertwined process cognitive-affective model, and relevant findings in the crowdfunding literature, a disjoint two-stage partial least squares structural equation modeling research model was applied to analyze the data collected from an online survey of 339 valid responses. The results indicated that potential backers regarded misconduct by a fundraiser as a significant threat to their freedom of donation in public crowdfunding. Antecedents, constituted by misconduct and trait proneness to reactance, were able to trigger a high level of psychological reactance. The state reactance, manifested in high levels of intertwined emotional and cognitive responses, induced particular attitudes towards the fundraiser, crowdfunding project, alternative crowdfunding projects, and expectations of other backers. Then, the aroused attitudes led to a series of behaviors aim at restoring the threatened freedom of donation. The mediating effect of psychological reactance on the positive relationship between antecedents and attitudes was empirically proved significant. The findings of this study offer valuable insights for both scholarly discourse on crowdfunding and practitioners engaged in crowdfunding endeavors.