Legal protection and underpricing of IPOs: Evidence from China

Jianlei Liu, Konari Uchida, Ruidong Gao

研究成果: Contribution to journalArticle査読

14 被引用数 (Scopus)

抄録

Chinese data enable investigation of the relationship between underpricing of initial public offerings (IPOs) and legal protection with controlling for time-invariant characteristics of regions. Our investigation of Chinese IPOs between 1997 and 2009 shows that firms from a province with more developed legal framework experience less underpricing after controlling for time-invariant, province-fixed effects. We also find that the extent of underpricing is decreased by the strength of legal protection of property rights. Importantly, these tendencies are evident only after the introduction of a book-building system, which provides issuers and underwriters with discretion on offering price determination. These results offer robust evidence that legal protection mitigates ex ante uncertainty regarding property rights protection, and thereby, reduces underpricing.

本文言語英語
ページ(範囲)163-187
ページ数25
ジャーナルPacific Basin Finance Journal
27
1
DOI
出版ステータス出版済み - 4 2014

All Science Journal Classification (ASJC) codes

  • 財務
  • 経済学、計量経済学

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