TESTS OF ADVERSE SELECTION MODELS IN THE NEW ISSUES MARKET

Authors
JAIN BA
Citation
Ba. Jain, TESTS OF ADVERSE SELECTION MODELS IN THE NEW ISSUES MARKET, Omega, 25(3), 1997, pp. 365-376
Citations number
17
Categorie Soggetti
Management,"Operatione Research & Management Science","Operatione Research & Management Science
Journal title
Omega → ACNP
ISSN journal
03050483
Volume
25
Issue
3
Year of publication
1997
Pages
365 - 376
Database
ISI
SICI code
0305-0483(1997)25:3<365:TOASMI>2.0.ZU;2-B
Abstract
Due to information asymmetry between various market participants, the new issues market is characterized by the classic adverse selection pr oblem, Several theoretical models have suggested that high quality IPO firms resort to underpricing and staged financing to overcome the adv erse selection problem, This paper provides a test of these adverse se lection models by examining the Link between IPO underpricing, staged financing and performance. (C) 1997 Elsevier Science Ltd.