The Effect of Listing Geography on Stock Prices

Steve H. Hanke and Caleb Hofmann

World Economics, 2025, vol. 26, issue 3, 24-37

Abstract: The paper examines if a stock's exchange listing location (New York vs. Europe) affects its price, challenging the efficient-market hypothesis, amid a growing valuation gap where US equities made up 60.5% of the global market in 2024. It critiques a Financial Times article from 17 March, 2025, which studied 12 European firms adding US listings, finding methodological issues like small sample size, inconsistent event windows (400–4000 days) and focusing on additional listings rather than full relisting. Using a difference-in-difference regression, the authors analyse 15 companies that delisted from Euronext and relisted in New York against 15 control firms, with standardised 53-day event windows, finding a 4.77% stock price drop post-relisting. The results suggest listing geography does not boost valuations, supporting the efficient-market hypothesis with price declines possibly due to investor unfamiliarity or perceived management tactics, though small sample size and confounders warrant cautious interpretation.

Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:wej:wldecn:953

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