Understanding (Ir)rational Herding Online

Investigations of social influence in collective decision-making have become possible due to recent technologies and platforms that record interactions in far larger groups than could be studied before. Herding and its impact on decision-making are critical areas of practical interest and research study. However, despite theoretical work suggesting that it matters whether individuals choose who to imitate based on cues such as experience or whether they herd at random, there is little empirical analysis of this distinction. To demonstrate the distinction between what the literature calls "rational" and "irrational" herding, we use data on tens of thousands of loans from a well-established online peer-to-peer (p2p) lending platform. First, we employ an empirical measure of memory in complex systems to measure herding in lending. Then, we illustrate a network-based approach to visualize herding. Finally, we model the impact of herding on collective outcomes. Our study reveals that loan performance is not solely determined by whether the lenders engage in herding or not. Instead, the interplay between herding and the imitated lenders' prior success on the platform predicts loan outcomes. In short, herds led by expert lenders tend to pick loans that do not default. We discuss the implications of this under-explored aspect of herding for platform designers, borrowers, and lenders. Our study advances collective intelligence theories based on a case of high-stakes group decision-making online

Emergent Influence Networks in Good-Faith Online Discussions

Town hall-type debates are increasingly moving online, irrevocably transforming public discourse. Yet, we know relatively little about crucial social dynamics that determine which arguments are more likely to be successful. This study investigates the impact of one's position in the discussion network created via responses to others' arguments on one's persuasiveness in unfacilitated online debates. We propose a novel framework for measuring the impact of network position on persuasiveness, using a combination of social network analysis and machine learning. Complementing existing studies investigating the effect of linguistic aspects on persuasiveness, we show that the user's position in a discussion network influences their persuasiveness online. Moreover, the recognition of successful persuasion further increases this dominant network position. Our findings offer important insights into the complex social dynamics of online discourse and provide practical insights for organizations and individuals seeking to understand the interplay between influential positions in a discussion network and persuasive strategies in digital spaces

Hidden Influences of Crowd Behavior in Crowdfunding: An Experimental Study

Crowdfunding continues to transform financing opportunities for many across the globe. While extensive research has explored factors related to fundraising success, less is known about the social signaling mechanisms that lead potential contributors to fund a project. Existing large-scale observational studies point to non-straightforward characteristics of prior contributions (aka "crowd signals") that forecast further contributions to a project, albeit without theoretical support for their effectiveness in predicting fundraising success. We translate empirical crowd signals based on variations in the amounts and timings of contributions into mock contribution scenarios to scrutinize the influence of essential signals on contributors' decisions to fund. We conduct two experiments with 1,250 online participants. The first experiment investigates whether high crowd signals, i.e., contributions of varying amounts arriving at unequally spaced time intervals, are making people more likely to contribute to a crowdfunding project. The second experiment further examines the effect of basic competition on the role of the crowd signals. Across both, we observe that high crowd signals attract 19.2% more contributors than low signals. These findings are robust to different project types, fundraising goals, participants' interest level in the projects, their altruistic attitudes, and susceptibility to social influence. Participants' unguided, post-hoc reflections about the reasons behind their choice to fund revealed that most were unaware of their reliance on any crowd signals and instead attributed their decision to nonexistent differences in project descriptions. These results point to the power of crowd signals unbeknownst to those affected by them and lay the groundwork for theory-building, specifically in relation to the essential signaling that is happening on online platforms