IPO allocations: discriminatory or discretionary?

• 成果类型: Article
• 署名作者: Ljungqvist, AP; Wilhelm, WJ Jr
• 署名单位: New York University; Centre for Economic Policy Research - UK; University of Oxford; University of Virginia
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/S0304-405X(02)00138-1
• 发表日期: 2002
• 页码: 167-201
• 关键词: initial public offerings; Bookbuilding; Underpricing; intermediation; allocation policy

摘要

We estimate the structural links between IPO allocations, pre-market information production, and initial underpricing and find that (1) allocation policies favor institutional investors, both in the US and worldwide; (2) increasing institutional allocations results in offer prices that deviate more from the pre-marketing price range; (3) constraints on bankers' discretion reduce institutional allocations and result in smaller price revisions, indicating diminished information production; and (4) initial returns are directly related to information production and inversely related to institutional allocations. Our results indicate that discretionary allocations promote price discovery in the IPO market and reduce indirect issuance costs for IPO firms. (C) 2002 Elsevier Science B.V. All rights reserved.