Conservatism and international IPO underpricing

• 成果类型: Article
• 署名作者: Boulton, Thomas J.; Smart, Scott B.; Zutter, Chad J.
• 署名单位: University System of Ohio; Miami University; Indiana University System; Indiana University Bloomington; IU Kelley School of Business; Pennsylvania Commonwealth System of Higher Education (PCSHE); University of Pittsburgh
• 刊物名称: JOURNAL OF INTERNATIONAL BUSINESS STUDIES
• ISSN/ISSBN: 0047-2506
• DOI: 10.1057/s41267-016-0054-8
• 发表日期: 2017
• 页码: 763-785
• 关键词: International finance; initial public offerings; accounting conservatism; Underpricing

摘要

We study the impact of country-level accounting conservatism on international IPO underpricing. Examining 13,285 IPOs from 36 countries, we find that IPOs are underpriced less in countries in which existing public firms practice more accounting conservatism. The link between conservatism and underpricing is robust to alternative measures of conservatism, country mean regressions, sample country exclusions, and endogenous treatment models. Consistent with the hypothesis that conservatism reduces underpricing by mitigating the impact of information asymmetries, we find that higher country-level conservatism is associated with lower country-level PIN values and that the negative relation between conservatism and underpricing is strongest for IPOs involving small firms in which information asymmetries are likely to be high. Lastly, we find evidence that legal origin, a factor linked to the practice of conservatism, influences the relations between underpricing and conservatism.