Journal article
INFORMATION ASYMMETRY AND THE UNDERPRICING OF INITIAL PUBLIC OFFERINGS: FURTHER EMPIRICAL EVIDENCE
Abstract
Information Asymmetry is usually assumed in most explanations of the underpricing of initial public offerings (IPOs). In Baron's (1982) model, the underwriter is better informed than the issuing firm concerning the demand for the IPO. The greater uncertainty associated with the demand will lead to a greater underpricing due to the enhanced value of the underwriter's expertise. In the case that the issuer is also an informed investment banker, …
Authors
Cheung CS; Krinsky I
Journal
Journal of Business Finance & Accounting, Vol. 21, No. 5, pp. 739–747
Publisher
Wiley
Publication Date
July 1994
DOI
10.1111/j.1468-5957.1994.tb00346.x
ISSN
0306-686X