Abstract
We examine the impact of internationalization on IPO underpricing in China. Our findings, which suggest that internationalization can reduce IPO underpricing, echo similar findings in the literature. However, we document that the transmission channel is not consistent with a diversification benefit documented in the literature. Instead, we find that internationalization: 1) serves as a good signal for investors and certifies the IPO is a quality investment due to lower information asymmetry; and 2) enhances corporate governance so that agency problems are less severe, thus leading to lower IPO underpricing. Overall, the underlying mechanisms differ between mature and emerging markets.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
