Main Article Content
Abstract
This study examines the impact of human capital on funding success in the context of Equity Crowdfunding (ECF) by analyzing data from 72 start-up companies seeking funding through SANTARA, the first ECF platform in Indonesia. Our findings indicate that various human capital indicators, including the number of directors, team members, economics undergraduate education, and graduates from foreign universities, do not significantly influence ECF success. However, we observed an intriguing result: start-up leaders with undergraduate degrees have a negative impact on crowdfunding success, leading to longer funding durations. This suggests that start-ups in Indonesia should not solely prioritize leaders with impressive educational backgrounds but should also consider individuals with practical experience in the business industry to enhance their chances of crowdfunding success.
Keywords
Equity crowdfunding
Santara
human capital
funding success
Indonesia
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This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License. Copyright @2017. This is an open-access article distributed under the terms of the Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License (http://creativecommons.org/licenses/by-nc-sa/4.0/) which permits unrestricted non-commercial used, distribution and reproduction in any medium
How to Cite
Kusumaningrum, S. D., Risfandy, T., Purnomowati, N. H., & Hartomo, D. D. (2023). Human Capital and Funding Success: Evidence from an Indonesian Equity Crowdfunding. The Asian Journal of Technology Management (AJTM), 16(1), 52–64. https://doi.org/10.12695/ajtm.2023.16.1.4
References
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Ahlers, G. K. C., Cumming, D., Günther, C., & Schweizer, D. (2015). Signaling in equity crowdfunding. Entrepreneurship Theory and Practice, 39(4), 955–980.
Anglin, A. H., Wolfe, M. T., Short, J. C., McKenny, A. F., & Pidduck, R. J. (2018). Narcissistic rhetoric and crowdfunding performance: A social role theory perspective. Journal of Business Venturing, 33(6), 780–812.
Barbi, M., & Bigelli, M. (2017). Crowdfunding practices in and outside the US. Research in International Business and Finance, 42, 208–223.
Barbi, M., & Mattioli, S. (2019). Human capital, investor trust, and equity crowdfunding. Research in International Business and Finance, 49, 1–12. https://doi.org/https://doi.org/10.1016/j.ribaf.2019.02.005
Belleflamme, P., Lambert, T., & Schwienbacher, A. (2010). Crowdfunding: An industrial organization perspective. Prepared for the Workshop Digital Business Models: Understanding Strategies’, Held in Paris on June, 25–26.
Belleflamme, P., Omrani, N., & Peitz, M. (2015). The economics of crowdfunding platforms. Information Economics and Policy, 33, 11–28.
Bitros, G. C., & Karayiannis, A. D. (2010). Entrepreneurial morality: some indications from Greece. European Journal of International Management, 4(4), 333–361.
Blaseg, D., Cumming, D., & Koetter, M. (2021). Equity crowdfunding: high-quality or low-quality entrepreneurs? Entrepreneurship Theory and Practice, 45(3), 505–530.
Bougie, R., & Sekaran, U. (2016). Research Methods For Business: A Skill Building 7 ed. Wily.
Coakley, J., Lazos, A., & Liñares-Zegarra, J. M. (2022). Equity Crowdfunding Founder Teams: Campaign Success and Venture Failure. British Journal of Management, 33(1), 286–305. https://doi.org/https://doi.org/10.1111/1467-8551.12494
Connelly, B. L., Certo, S. T., Ireland, R. D., & Reutzel, C. R. (2010). Signaling Theory: A Review and Assessment. Journal of Management, 37(1), 39–67. https://doi.org/10.1177/0149206310388419
Cumming, D., Meoli, M., & Vismara, S. (2021). Does equity crowdfunding democratize entrepreneurial finance? Small Business Economics, 56(2), 533–552. https://doi.org/10.1007/s11187-019-00188-z
Davies, W. E., & Giovannetti, E. (2018). Signalling experience & reciprocity to temper asymmetric information in crowdfunding evidence from 10,000 projects. Technological Forecasting and Social Change, 133, 118–131.
de Crescenzo, V., Ribeiro-Soriano, D. E., & Covin, J. G. (2020). Exploring the viability of equity crowdfunding as a fundraising instrument: A configurational analysis of contingency factors that lead to crowdfunding success and failure. Journal of Business Research, 115, 348–356. https://doi.org/https://doi.org/10.1016/j.jbusres.2019.09.051
Dority, B., Borchers, S., & Hayes, S. (2021). Equity crowdfunding: US Title II offerings using sentiment analysis. Studies in Economics and Finance, ahead-of-print. https://doi.org/10.1108/SEF-04-2020-0097
Gössling, T. (2003). The price of morality. An analysis of personality, moral behaviour, and social rules in economic terms. Journal of Business Ethics, 45, 121–131.
Hakenes, H., & Schlegel, F. (2014). Exploiting the Financial Wisdom of the Crowd--Crowdfunding as a Tool to Aggregate Vague Information. Available at SSRN 2475025.
Kleinert, S., Volkmann, C., & Grünhagen, M. (2020). Third-party signals in equity crowdfunding: the role of prior financing. Small Business Economics, 54(1), 341–365. https://doi.org/10.1007/s11187-018-0125-2
Kunz, M. M., Bretschneider, U., Erler, M., & Leimeister, J. M. (2017). An empirical investigation of signaling in reward-based crowdfunding. Electronic Commerce Research, 17(3), 425–461.
Li, X., Tang, Y., Yang, N., Ren, R., Zheng, H., & Zhou, H. (2016). The value of information disclosure and lead investor in equity-based crowdfunding. Nankai Business Review International, 7(3), 301–321. https://doi.org/10.1108/NBRI-01-2016-0002
Lim, J. Y.-K., & Busenitz, L. W. (2020). Evolving human capital of entrepreneurs in an equity crowdfunding era. Journal of Small Business Management, 58(1), 106–129. https://EconPapers.repec.org/RePEc:taf:ujbmxx:v:58:y:2020:i:1:p:106-129
Lukkarinen, A., Teich, J. E., Wallenius, H., & Wallenius, J. (2016). Success drivers of online equity crowdfunding campaigns. Decision Support Systems, 87, 26–38.
Mamonov, S., & Malaga, R. (2019). Success factors in Title II equity crowdfunding in the United States. Venture Capital, 21(2–3), 223–241. https://doi.org/10.1080/13691066.2018.1468471
Marvel, M. R., Davis, J. L., & Sproul, C. R. (2016). Human Capital and Entrepreneurship Research: A Critical Review and Future Directions. Entrepreneurship Theory and Practice, 40(3), 599–626. https://doi.org/10.1111/etap.12136
Mohammadi, A., & Shafi, K. (2018). Gender differences in the contribution patterns of equity-crowdfunding investors. Small Business Economics, 50(2), 275–287.
Mollick, E. (2014). The dynamics of crowdfunding: An exploratory study. Journal of Business Venturing, 29(1), 1–16.
Nitani, M., Riding, A., & He, B. (2019). On equity crowdfunding: investor rationality and success factors. Venture Capital, 21(2–3), 243–272. https://doi.org/10.1080/13691066.2018.1468542
Piva, E., & Rossi-Lamastra, C. (2018). Human capital signals and entrepreneurs’ success in equity crowdfunding. Small Business Economics, 51(3), 667–686.
Ralcheva, A., & Roosenboom, P. (2016). On the road to success in equity crowdfunding. Available at SSRN 2727742.
Ralcheva, A., & Roosenboom, P. (2020). Forecasting success in equity crowdfunding. Small Business Economics, 55(1), 39–56. https://doi.org/10.1007/s11187-019-00144-x
Ross, S. A. (1977). The determination of financial structure: the incentive-signalling approach. The Bell Journal of Economics, 23–40.
Shafi, K. (2021). Investors’ evaluation criteria in equity crowdfunding. Small Business Economics, 56(1), 3–37. https://doi.org/10.1007/s11187-019-00227-9
Spence, M. S. (n.d.). M., 1973,«Job market signalling». Quarterly Journal of Economics, 90, 225–243.
Uhlaner, L., & Thurik, R. (2010). Postmaterialism influencing total entrepreneurial activity across nations. Springer.
Unger, J. M., Rauch, A., Frese, M., & Rosenbusch, N. (2011). Human capital and entrepreneurial success: A meta-analytical review. Journal of Business Venturing, 26(3), 341–358. https://EconPapers.repec.org/RePEc:eee:jbvent:v:26:y:2011:i:3:p:341-358
Viotto da Cruz, J. (2015). Competition and regulation of crowdfunding platforms: A two-sided market approach. Communications & Strategies, 99, 33–50.
Vismara, S. (2016). Equity retention and social network theory in equity crowdfunding. Small Business Economics, 46(4), 579–590.
Vismara, S. (2019). Sustainability in equity crowdfunding. Technological Forecasting and Social Change, 141, 98–106. https://doi.org/https://doi.org/10.1016/j.techfore.2018.07.014
Zacharakis, A. L., & Meyer, G. D. (2000). The potential of actuarial decision models: can they improve the venture capital investment decision? Journal of Business Venturing, 15(4), 323–346.
Zhou, M. J., Lu, B., Fan, W. P., & Wang, G. A. (2018). Project description and crowdfunding success: an exploratory study. Information Systems Frontiers, 20(2), 259–274.
References
Ahlers, G. K. C., Cumming, D., Günther, C., & Schweizer, D. (2015). Signaling in equity crowdfunding. Entrepreneurship Theory and Practice, 39(4), 955–980.
Anglin, A. H., Wolfe, M. T., Short, J. C., McKenny, A. F., & Pidduck, R. J. (2018). Narcissistic rhetoric and crowdfunding performance: A social role theory perspective. Journal of Business Venturing, 33(6), 780–812.
Barbi, M., & Bigelli, M. (2017). Crowdfunding practices in and outside the US. Research in International Business and Finance, 42, 208–223.
Barbi, M., & Mattioli, S. (2019). Human capital, investor trust, and equity crowdfunding. Research in International Business and Finance, 49, 1–12. https://doi.org/https://doi.org/10.1016/j.ribaf.2019.02.005
Belleflamme, P., Lambert, T., & Schwienbacher, A. (2010). Crowdfunding: An industrial organization perspective. Prepared for the Workshop Digital Business Models: Understanding Strategies’, Held in Paris on June, 25–26.
Belleflamme, P., Omrani, N., & Peitz, M. (2015). The economics of crowdfunding platforms. Information Economics and Policy, 33, 11–28.
Bitros, G. C., & Karayiannis, A. D. (2010). Entrepreneurial morality: some indications from Greece. European Journal of International Management, 4(4), 333–361.
Blaseg, D., Cumming, D., & Koetter, M. (2021). Equity crowdfunding: high-quality or low-quality entrepreneurs? Entrepreneurship Theory and Practice, 45(3), 505–530.
Bougie, R., & Sekaran, U. (2016). Research Methods For Business: A Skill Building 7 ed. Wily.
Coakley, J., Lazos, A., & Liñares-Zegarra, J. M. (2022). Equity Crowdfunding Founder Teams: Campaign Success and Venture Failure. British Journal of Management, 33(1), 286–305. https://doi.org/https://doi.org/10.1111/1467-8551.12494
Connelly, B. L., Certo, S. T., Ireland, R. D., & Reutzel, C. R. (2010). Signaling Theory: A Review and Assessment. Journal of Management, 37(1), 39–67. https://doi.org/10.1177/0149206310388419
Cumming, D., Meoli, M., & Vismara, S. (2021). Does equity crowdfunding democratize entrepreneurial finance? Small Business Economics, 56(2), 533–552. https://doi.org/10.1007/s11187-019-00188-z
Davies, W. E., & Giovannetti, E. (2018). Signalling experience & reciprocity to temper asymmetric information in crowdfunding evidence from 10,000 projects. Technological Forecasting and Social Change, 133, 118–131.
de Crescenzo, V., Ribeiro-Soriano, D. E., & Covin, J. G. (2020). Exploring the viability of equity crowdfunding as a fundraising instrument: A configurational analysis of contingency factors that lead to crowdfunding success and failure. Journal of Business Research, 115, 348–356. https://doi.org/https://doi.org/10.1016/j.jbusres.2019.09.051
Dority, B., Borchers, S., & Hayes, S. (2021). Equity crowdfunding: US Title II offerings using sentiment analysis. Studies in Economics and Finance, ahead-of-print. https://doi.org/10.1108/SEF-04-2020-0097
Gössling, T. (2003). The price of morality. An analysis of personality, moral behaviour, and social rules in economic terms. Journal of Business Ethics, 45, 121–131.
Hakenes, H., & Schlegel, F. (2014). Exploiting the Financial Wisdom of the Crowd--Crowdfunding as a Tool to Aggregate Vague Information. Available at SSRN 2475025.
Kleinert, S., Volkmann, C., & Grünhagen, M. (2020). Third-party signals in equity crowdfunding: the role of prior financing. Small Business Economics, 54(1), 341–365. https://doi.org/10.1007/s11187-018-0125-2
Kunz, M. M., Bretschneider, U., Erler, M., & Leimeister, J. M. (2017). An empirical investigation of signaling in reward-based crowdfunding. Electronic Commerce Research, 17(3), 425–461.
Li, X., Tang, Y., Yang, N., Ren, R., Zheng, H., & Zhou, H. (2016). The value of information disclosure and lead investor in equity-based crowdfunding. Nankai Business Review International, 7(3), 301–321. https://doi.org/10.1108/NBRI-01-2016-0002
Lim, J. Y.-K., & Busenitz, L. W. (2020). Evolving human capital of entrepreneurs in an equity crowdfunding era. Journal of Small Business Management, 58(1), 106–129. https://EconPapers.repec.org/RePEc:taf:ujbmxx:v:58:y:2020:i:1:p:106-129
Lukkarinen, A., Teich, J. E., Wallenius, H., & Wallenius, J. (2016). Success drivers of online equity crowdfunding campaigns. Decision Support Systems, 87, 26–38.
Mamonov, S., & Malaga, R. (2019). Success factors in Title II equity crowdfunding in the United States. Venture Capital, 21(2–3), 223–241. https://doi.org/10.1080/13691066.2018.1468471
Marvel, M. R., Davis, J. L., & Sproul, C. R. (2016). Human Capital and Entrepreneurship Research: A Critical Review and Future Directions. Entrepreneurship Theory and Practice, 40(3), 599–626. https://doi.org/10.1111/etap.12136
Mohammadi, A., & Shafi, K. (2018). Gender differences in the contribution patterns of equity-crowdfunding investors. Small Business Economics, 50(2), 275–287.
Mollick, E. (2014). The dynamics of crowdfunding: An exploratory study. Journal of Business Venturing, 29(1), 1–16.
Nitani, M., Riding, A., & He, B. (2019). On equity crowdfunding: investor rationality and success factors. Venture Capital, 21(2–3), 243–272. https://doi.org/10.1080/13691066.2018.1468542
Piva, E., & Rossi-Lamastra, C. (2018). Human capital signals and entrepreneurs’ success in equity crowdfunding. Small Business Economics, 51(3), 667–686.
Ralcheva, A., & Roosenboom, P. (2016). On the road to success in equity crowdfunding. Available at SSRN 2727742.
Ralcheva, A., & Roosenboom, P. (2020). Forecasting success in equity crowdfunding. Small Business Economics, 55(1), 39–56. https://doi.org/10.1007/s11187-019-00144-x
Ross, S. A. (1977). The determination of financial structure: the incentive-signalling approach. The Bell Journal of Economics, 23–40.
Shafi, K. (2021). Investors’ evaluation criteria in equity crowdfunding. Small Business Economics, 56(1), 3–37. https://doi.org/10.1007/s11187-019-00227-9
Spence, M. S. (n.d.). M., 1973,«Job market signalling». Quarterly Journal of Economics, 90, 225–243.
Uhlaner, L., & Thurik, R. (2010). Postmaterialism influencing total entrepreneurial activity across nations. Springer.
Unger, J. M., Rauch, A., Frese, M., & Rosenbusch, N. (2011). Human capital and entrepreneurial success: A meta-analytical review. Journal of Business Venturing, 26(3), 341–358. https://EconPapers.repec.org/RePEc:eee:jbvent:v:26:y:2011:i:3:p:341-358
Viotto da Cruz, J. (2015). Competition and regulation of crowdfunding platforms: A two-sided market approach. Communications & Strategies, 99, 33–50.
Vismara, S. (2016). Equity retention and social network theory in equity crowdfunding. Small Business Economics, 46(4), 579–590.
Vismara, S. (2019). Sustainability in equity crowdfunding. Technological Forecasting and Social Change, 141, 98–106. https://doi.org/https://doi.org/10.1016/j.techfore.2018.07.014
Zacharakis, A. L., & Meyer, G. D. (2000). The potential of actuarial decision models: can they improve the venture capital investment decision? Journal of Business Venturing, 15(4), 323–346.
Zhou, M. J., Lu, B., Fan, W. P., & Wang, G. A. (2018). Project description and crowdfunding success: an exploratory study. Information Systems Frontiers, 20(2), 259–274.
Anglin, A. H., Wolfe, M. T., Short, J. C., McKenny, A. F., & Pidduck, R. J. (2018). Narcissistic rhetoric and crowdfunding performance: A social role theory perspective. Journal of Business Venturing, 33(6), 780–812.
Barbi, M., & Bigelli, M. (2017). Crowdfunding practices in and outside the US. Research in International Business and Finance, 42, 208–223.
Barbi, M., & Mattioli, S. (2019). Human capital, investor trust, and equity crowdfunding. Research in International Business and Finance, 49, 1–12. https://doi.org/https://doi.org/10.1016/j.ribaf.2019.02.005
Belleflamme, P., Lambert, T., & Schwienbacher, A. (2010). Crowdfunding: An industrial organization perspective. Prepared for the Workshop Digital Business Models: Understanding Strategies’, Held in Paris on June, 25–26.
Belleflamme, P., Omrani, N., & Peitz, M. (2015). The economics of crowdfunding platforms. Information Economics and Policy, 33, 11–28.
Bitros, G. C., & Karayiannis, A. D. (2010). Entrepreneurial morality: some indications from Greece. European Journal of International Management, 4(4), 333–361.
Blaseg, D., Cumming, D., & Koetter, M. (2021). Equity crowdfunding: high-quality or low-quality entrepreneurs? Entrepreneurship Theory and Practice, 45(3), 505–530.
Bougie, R., & Sekaran, U. (2016). Research Methods For Business: A Skill Building 7 ed. Wily.
Coakley, J., Lazos, A., & Liñares-Zegarra, J. M. (2022). Equity Crowdfunding Founder Teams: Campaign Success and Venture Failure. British Journal of Management, 33(1), 286–305. https://doi.org/https://doi.org/10.1111/1467-8551.12494
Connelly, B. L., Certo, S. T., Ireland, R. D., & Reutzel, C. R. (2010). Signaling Theory: A Review and Assessment. Journal of Management, 37(1), 39–67. https://doi.org/10.1177/0149206310388419
Cumming, D., Meoli, M., & Vismara, S. (2021). Does equity crowdfunding democratize entrepreneurial finance? Small Business Economics, 56(2), 533–552. https://doi.org/10.1007/s11187-019-00188-z
Davies, W. E., & Giovannetti, E. (2018). Signalling experience & reciprocity to temper asymmetric information in crowdfunding evidence from 10,000 projects. Technological Forecasting and Social Change, 133, 118–131.
de Crescenzo, V., Ribeiro-Soriano, D. E., & Covin, J. G. (2020). Exploring the viability of equity crowdfunding as a fundraising instrument: A configurational analysis of contingency factors that lead to crowdfunding success and failure. Journal of Business Research, 115, 348–356. https://doi.org/https://doi.org/10.1016/j.jbusres.2019.09.051
Dority, B., Borchers, S., & Hayes, S. (2021). Equity crowdfunding: US Title II offerings using sentiment analysis. Studies in Economics and Finance, ahead-of-print. https://doi.org/10.1108/SEF-04-2020-0097
Gössling, T. (2003). The price of morality. An analysis of personality, moral behaviour, and social rules in economic terms. Journal of Business Ethics, 45, 121–131.
Hakenes, H., & Schlegel, F. (2014). Exploiting the Financial Wisdom of the Crowd--Crowdfunding as a Tool to Aggregate Vague Information. Available at SSRN 2475025.
Kleinert, S., Volkmann, C., & Grünhagen, M. (2020). Third-party signals in equity crowdfunding: the role of prior financing. Small Business Economics, 54(1), 341–365. https://doi.org/10.1007/s11187-018-0125-2
Kunz, M. M., Bretschneider, U., Erler, M., & Leimeister, J. M. (2017). An empirical investigation of signaling in reward-based crowdfunding. Electronic Commerce Research, 17(3), 425–461.
Li, X., Tang, Y., Yang, N., Ren, R., Zheng, H., & Zhou, H. (2016). The value of information disclosure and lead investor in equity-based crowdfunding. Nankai Business Review International, 7(3), 301–321. https://doi.org/10.1108/NBRI-01-2016-0002
Lim, J. Y.-K., & Busenitz, L. W. (2020). Evolving human capital of entrepreneurs in an equity crowdfunding era. Journal of Small Business Management, 58(1), 106–129. https://EconPapers.repec.org/RePEc:taf:ujbmxx:v:58:y:2020:i:1:p:106-129
Lukkarinen, A., Teich, J. E., Wallenius, H., & Wallenius, J. (2016). Success drivers of online equity crowdfunding campaigns. Decision Support Systems, 87, 26–38.
Mamonov, S., & Malaga, R. (2019). Success factors in Title II equity crowdfunding in the United States. Venture Capital, 21(2–3), 223–241. https://doi.org/10.1080/13691066.2018.1468471
Marvel, M. R., Davis, J. L., & Sproul, C. R. (2016). Human Capital and Entrepreneurship Research: A Critical Review and Future Directions. Entrepreneurship Theory and Practice, 40(3), 599–626. https://doi.org/10.1111/etap.12136
Mohammadi, A., & Shafi, K. (2018). Gender differences in the contribution patterns of equity-crowdfunding investors. Small Business Economics, 50(2), 275–287.
Mollick, E. (2014). The dynamics of crowdfunding: An exploratory study. Journal of Business Venturing, 29(1), 1–16.
Nitani, M., Riding, A., & He, B. (2019). On equity crowdfunding: investor rationality and success factors. Venture Capital, 21(2–3), 243–272. https://doi.org/10.1080/13691066.2018.1468542
Piva, E., & Rossi-Lamastra, C. (2018). Human capital signals and entrepreneurs’ success in equity crowdfunding. Small Business Economics, 51(3), 667–686.
Ralcheva, A., & Roosenboom, P. (2016). On the road to success in equity crowdfunding. Available at SSRN 2727742.
Ralcheva, A., & Roosenboom, P. (2020). Forecasting success in equity crowdfunding. Small Business Economics, 55(1), 39–56. https://doi.org/10.1007/s11187-019-00144-x
Ross, S. A. (1977). The determination of financial structure: the incentive-signalling approach. The Bell Journal of Economics, 23–40.
Shafi, K. (2021). Investors’ evaluation criteria in equity crowdfunding. Small Business Economics, 56(1), 3–37. https://doi.org/10.1007/s11187-019-00227-9
Spence, M. S. (n.d.). M., 1973,«Job market signalling». Quarterly Journal of Economics, 90, 225–243.
Uhlaner, L., & Thurik, R. (2010). Postmaterialism influencing total entrepreneurial activity across nations. Springer.
Unger, J. M., Rauch, A., Frese, M., & Rosenbusch, N. (2011). Human capital and entrepreneurial success: A meta-analytical review. Journal of Business Venturing, 26(3), 341–358. https://EconPapers.repec.org/RePEc:eee:jbvent:v:26:y:2011:i:3:p:341-358
Viotto da Cruz, J. (2015). Competition and regulation of crowdfunding platforms: A two-sided market approach. Communications & Strategies, 99, 33–50.
Vismara, S. (2016). Equity retention and social network theory in equity crowdfunding. Small Business Economics, 46(4), 579–590.
Vismara, S. (2019). Sustainability in equity crowdfunding. Technological Forecasting and Social Change, 141, 98–106. https://doi.org/https://doi.org/10.1016/j.techfore.2018.07.014
Zacharakis, A. L., & Meyer, G. D. (2000). The potential of actuarial decision models: can they improve the venture capital investment decision? Journal of Business Venturing, 15(4), 323–346.
Zhou, M. J., Lu, B., Fan, W. P., & Wang, G. A. (2018). Project description and crowdfunding success: an exploratory study. Information Systems Frontiers, 20(2), 259–274.