'Wisdom of crowds' as an antidote for the 'credit crunch'. A preliminary analysis on crowdfunding

This paper analyses the linkages between the standard lines of credit (financial intermediaries, public sector, private investors) and the recent development of crowdfunding phenomenon. We believe that crowdfunding activities, even if yet not significant in terms of volumes, might play a major role in the future, complementing the traditional activities of financial intermediation. In support of our beliefs, we notice the establishment of several crowdfunding platforms operating at worldwide, particularly in the USA and in the EU, and the relevance assigned to crowdfunding procedures in the Obama’s JOBS Act of 2012 and in a consultation on crowdfunding launched at the end of 2013 by the European Commission. At national level, we recognize several peculiarities of crowdfunding activities, mostly related to donation and reward-based schemes, but also the disposals of the so called ‘Growth Decree 2.0’ on the equity-based crowdfunding and the on-line consultation subsequently implemented by the CONSOB. The paper, after an introduction to crowdfunding and a focused academic literature review, tries to single out the (potentially) main determinants of the crowdfunding demand of funds. By using the available data at European level we develop a Crowdfunding Attractiveness Index (CFA), with the aim to rank the crowfunding potential of different European countries.