Crowd Science in the Perspective of Economics

Abstract

In this paper, we try to bridge two disciplines: crowd science and economics. We first re-expound five essential research questions in the perspective of economics and elaborate how to study crowd science in the framework of economics in each essential question. Then, we build a simple model to illustrate the importance of wisdom of crowd by investigating the incentive of product development in crowdfunding when the market demand is uncertain. We show that, that under certain conditions, crowdfunding can provide more accurate demand information and therefore can generate better incentives to entrepreneurs and help entrepreneurs make correct decisions.