The dynamics of cointegration between equity crowdfunding performance and economic indicators in Malaysia: ARDL approach

The financial scene underwent significant transformation when equity crowdfunding (ECF) provided businesses and individuals with an alternative approach to obtain funding. Established enterprises together with startups gain funding from investors of different backgrounds through ECF platforms. ECF has achieved significant importance but researchers still need to investigate further how ECF performance relates to standard economic metrics including unemployment data along with inflation patterns, GDP measures and interest rates. Research on ECF generally focuses on micro-level elements within their framework while ignoring substantial relationships between ECF performance and economic indicators. Therefore, this research seeks to comprehensively establish the relationship that may exist between the ECF performance and economic indicators in Malaysia context. This study utilizes the Autoregressive Distributed Lag (ARDL) approach to understand the long-run and short-run associations between ECF performance measurements and primary economic indicators. The time series and ECF monthly data from 2017 to 2022 were collected from the Department of Statistics Malaysia (DOSM) and Securities Commission Malaysia (SC). The ARDL revealed a mix result on the existence of significant long-run and short-run relationship between the ECF performance and some economic indicators. The results reveals that there are significant long-run and short-run relationships between the GDP and BLR with the ECF amount raised, while unemployment and BLR influence the number of investors.