A theory of the transition to secondary market trading of IPOs

• 成果类型: Article
• 署名作者: Chen, Zhaohui; Wilhelm, William J., Jr.
• 署名单位: Pennsylvania Commonwealth System of Higher Education (PCSHE); Temple University; University of Virginia
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2007.08.006
• 发表日期: 2008
• 页码: 219-236
• 关键词: PRICE SUPPORT; Initial public offering; Flipping; auction; Securities regulation

摘要

We develop a model in which investment banks and institutional investors collaborate in smoothing an initial public offering's (IPOs) transition to secondary market trading. Their intervention promotes welfare under the assumption that significant new information arrives in the market in the immediate aftermath of the IPO. Under this assumption, it is optimal to stage the offering and suboptimal to commit to selling shares at a uniform price. The optimal strategy yields an economic rationale for secondary market price stabilization for IPOs carried out via a well-coordinated network of repeat institutional investors. (C) 2008 Elsevier B.V. All rights reserved.