Abstract
We examine the role of executive and director networks in IPO firms, and find that IPO firms experience significantly smaller underpricing when their executives and directors are more central in the social network. The mitigating effect of executive and director connections on underpricing is concentrated in smaller offers, geographically isolated issuers, and issuers with greater industry return volatility. Overall, our evidence is consistent with the notion that well-connected executives and directors help mitigate information asymmetry in IPO firms and hence reducing IPO underpricing.
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