IPO policy and IPO underpricing: Evidence from the registration-based IPO reform in China

Jiahui Li and Rui Li

Finance Research Letters, 2022, vol. 47, issue PA

Abstract: Based on difference-in-differences method, this document investigates the effects of IPO policies on price efficiency of the Chinese market IPOs. Different from the existing literatures, we document that market-oriented reform even significantly magnifies the initial returns, and no significant effects are detected in longer periods. We argue that registration-based IPO system may amplify the aggressive speculation on the newly listed stocks, which blows up the after-market prices.

Keywords: registration-based IPO system; approval-based IPO system; IPO underpricing; speculation (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:47:y:2022:i:pa:s1544612321005602

DOI: 10.1016/j.frl.2021.102623

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