Community Investment: Improving Feedback Loops in Project Delivery with Participatory Technology
Project Team
Raymond Levitt, Kate Gasparro
Overview
Made popular by trends in crowdfunding, community investment is one participatory technology that offers an innovative approach to improving local infrastructure delivery by increasing financial and social support for specific projects. At a basic level, community investment allows individuals to contribute to or invest in specific projects; and, at a larger level, community investment is democratizing the infrastructure delivery process and allowing individuals to have more agency in deciding which projects they prefer. But, as of yet, there has been very little research exploring the implications of community investment and its impact on local infrastructure delivery. This research takes a qualitative approach and explores how several cities have faced challenges and opportunities when implementing community investment to motivate infrastructure delivery.
Project Background
Research Motivation
Urbanization trends have put more stress on infrastructure networks, at a time when local governments are struggling to pay for infrastructure construction, operations, and maintenance. Not only have budgetary constraints prevented necessary construction and maintenance of infrastructure, community opposition has halted local infrastructure delivery due to poor public participation processes. New participatory technologies, that bring together crowdsourcing science and online payment capabilities, can address this two-pronged problem by increasing financial as well as social support for projects. Because, even as infrastructure development becomes more efficient and safe due to better design and technical expertise, public opinion (in its unpredictability) is a factor that continues to impact project success.
Industry Example
This research inherently requires collaboration with industry partners and government policy makers. As such, current industry partners involved in this research are community investment (crowdfunding) platforms such as SpaceHive, ioby, FundRise, CrowdStreet, and InfraShares. These platforms are young and their developers are learning how to navigate the policy and regulatory environment to help project sponsors and local governments fund projects. Recently, ioby has developed city-based teams that are helping local leaders identify infrastructure projects and public goods that are needed by neighborhoods. Ioby’s community investment platform has allowed over 1,300 projects to be funded by community members. In partnership with local government entities, project ideas have come to life to build more vibrant cities.
Research Objectives
The dual role of community investment hints at reasons why a local government (or other project stakeholders) choose community investment and alludes to possible project and stakeholder implications during the delivery process. But, without more empirical research on community investment, it is difficult to confirm these hypotheses.
Phase I: Theoretical Underpinnings
We are interested in understanding the theoretical rational for using participatory technology. Through the lens of principal-agent theory, we explore how participatory technology, more specifically community investment and civic technology, can be used to resolve issues between local governments and communities during infrastructure delivery. Community investment involves a new stakeholder, the project sponsor. The project sponsor is responsible for leading the community investment process and becomes a boundary spanning intermediary. As such, the project sponsor is able to potentially mitigate issues that are often found in traditional principal-agent relationships during infrastructure delivery. This work was presented at the Engineering Project Organization Conference in June 2018.
Phase 2: Participatory Technology Landscape
Participatory technology in all its forms (including e-governance and civic technology) has become more pervasive in the United States. This phase is focused on aggregating information on different types of participatory technologies being used during the local infrastructure delivery process. We are organizing these technologies such that we can understand how the technologies can be applied throughout the infrastructure delivery process. As part of this phase, we are also interviewing CEOs of different participatory technology platforms.
Phase 3: Comparing Contexts
We have previously conducted case studies of infrastructure projects that use crowdfunding. Building on two past case studies in the United States, we will be conducting a new case study in England in Summer 2018. In recent years, the Mayor of London has used crowdfunding as a way to increase community leadership and initiative, as well as increase community “buy-in” for infrastructure delivery. As part of this crowdfunding program, the Mayor has set-up formal office for reviewing projects and helping community leaders build capacity for launching their own crowdfunding campaigns. Each year, the Mayor has dedicated matching funds for projects. This city-wide crowdfunding program provides a perfect environment for this case study. Whereas the two past case studies focused on specific projects within a city, the focus of this study will be on a portfolio of projects that are processed through the Mayor’s crowdfunding office. As part of this study, I will be interviewing key stakeholders involved with the Mayor’s crowdfunding office and those that have worked on crowdfunding projects within London that have benefitted from the Mayor’s crowdfunding program. We are interested in comparing a project-based approach and a city-wide approach to crowdfunding infrastructure.
Expected Results
With increased attention on participatory technologies, there is a need to understand how the community (and thus community investors) are interacting with infrastructure delivery. The expected results from this research will help communities and local governments better understand how to leverage participatory technology to better delivery local infrastructure projects. Preliminary findings from this research highlight the importance of specific project conditions in enabling community investment to be used. For example, the political and governance landscape of the city can influence how traditional stakeholders adopt new technologies. At the same time, the relationships between certain stakeholders can facilitate the decision to use community investment on one project rather than another. These preliminary findings can help guide local government agencies and infrastructure developers in how they choose to deploy participatory technologies.
Related Publications/Online Tool
EPOC Conference Proceedings "Civic Crowdfunding: Addressing Principal-Agent Issues During Local Infrastructure Delivery, Page 341, Gasparro (Details)
Interactive Tool to explain research to practitioners (Details)
CROWDFUNDING OUR CITIES: THREE PERSPECTIVES ON STAkEHOLDER DYNAMICS DURING INNOVATIVE INFRASTRUCTURE DELIVERY (Details)
A Dissertation Submitted to the Department of Civil and Environmental Engineering and the Committee on Graduate Studies of Stanford University in Partial Fulfillment of the Requirements for the degree of the Doctor of Philosphy, Gasparro
Original Research Proposal
Final Project Report
Funding Year:
2018