An empirical examination of IPO underpricing in the Chinese A-share market

被引:54
作者
Yu, Ting
Tse, Y. K. [1 ]
机构
[1] Singapore Management Univ, Sch Econ & Social Sci, Singapore 178903, Singapore
[2] Natl Univ Singapore, Dept Econ, Singapore 117570, Singapore
关键词
initial public offering; ex ante uncertainty; signaling; winner's curse;
D O I
10.1016/j.chieco.2005.07.001
中图分类号
F [经济];
学科分类号
02 ;
摘要
Research in the literature shows that initial public offerings (IPOs) of common stocks are systematically priced at a discount to their subsequent initial trading price. The large underpricing magnitude in the Chinese IPO market has attracted much attention. We consider three hypotheses that may explain the IPO underpricing in China. These are the winner's curse hypothesis, the ex ante uncertainty hypothesis and the signaling hypothesis. Among these hypotheses, the winner's curse hypothesis has not been tested in the Chinese market. Using IPO data for online fixed-price offerings from November 1995 to December 1998, our results show that the winner's curse hypothesis is the main reason for the high IPO underpricing in China. The signaling hypothesis is not empirically supported in the Chinese market during the sample period. (c) 2005 Elsevier Inc. All rights reserved.
引用
收藏
页码:363 / 382
页数:20
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