Crowdfunding ‘could threaten government investment’

The use of crowdfunding to finance research could be used by the government as an excuse to cut public spending, an expert has warned

January 19, 2014

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Joe Cox, principal lecturer in economics at the University of Portsmouth, said that the practice of academic crowdfunding – whereby researchers ask members of the public to back their project by making a donation – had the potential to complement existing funding mechanisms, but that it could be viewed by government as a way to cut research spending.

“If we accept that crowdfunding does potentially have a role to play in backing projects of academic research then we need to ask some very serious questions about how this fits in with the existing landscape for funding academic research,” he told the Innovation in Enterprise Funding: University Crowdfunding conference at the University of Westminster in London on 17 January.

“You have a very real risk that crowdfunding will be seen, particularly by politicians, as a pure substitute for traditional funding streams.

“In other words, if people are willing to get behind and back particular projects out of there own pockets, we can cut back on the level of public funding we devote to university research.”

The process of funding research projects by appealing for donations is more established in the US, where a number of researchers – often in scientific disciplines – have succeeded in raising funds by soliciting online donations.

Dr Cox is leading a team that won a £750,000 grant from the UK’s Engineering and Physical Sciences Research Council to research the intricacies of crowdfunding.  

“I think certain research questions, if they are put across in the right way, could be suitable for crowdfunding platforms,” he said, citing the financial crisis and banking regulation as two areas in his own discipline that might capture the public’s imagination.

In addition, using crowdfunding to finance research was a way to demonstrate “public engagement, outreach, and impact”, while “dispelling the myth that the public might hold surrounding academic research: that we sit in ivory towers very far removed from the everyday world”.

However, “dryer” topics that were no less academically valuable might not be so successful in attracting money, he added.

“I don’t think there is a scenario where crowdfunding can completely replace existing funding,” he concluded. “I think the involvement of crowds and crowdfunding is exciting and offers great potential [for] research that has academic value but that also captures the public imagination.”

chris.parr@tsleducation.com

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