IPO Pricing in the Dot‐com Bubble

Alexander Ljungqvist () and William J. Wilhelm

Journal of Finance, 2003, vol. 58, issue 2, 723-752

Abstract: IPO underpricing reached astronomical levels during 1999 and 2000. We show that the regime shift in initial returns and other elements of pricing behavior can be at least partially accounted for by marked changes in pre‐IPO ownership structure and insider selling behavior over the period, which reduced key decision makers' incentives to control underpricing. After controlling for these changes, the difference in underpricing between 1999 and 2000 and the preceding three years is much reduced. Our results suggest that it was firm characteristics that were unique during the “dot‐com bubble” and that pricing behavior followed from incentives created by these characteristics.

Date: 2003
References: Add references at CitEc
Citations: View citations in EconPapers (215)

Downloads: (external link)
https://doi.org/10.1111/1540-6261.00543

Related works:
Working Paper: IPO Pricing in the dot-com Bubble (2002)
Working Paper: IPO Pricing in the Dot-com Bubble (2002)
Working Paper: IPO Pricing in the Dot-com Bubble (2002)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:jfinan:v:58:y:2003:i:2:p:723-752

Ordering information: This journal article can be ordered from
http://www.afajof.org/membership/join.asp

Access Statistics for this article

More articles in Journal of Finance from American Finance Association Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().