EconPapers    
Economics at your fingertips  
 

Firm Value and Cross Listings: The Impact of Stock Market Prestige

Nicola Cetorelli () and Stavros Peristiani ()

Journal of Risk and Financial Management, 2015, vol. 8, issue 1, 1-31

Abstract: This study investigates the valuation impact of a firm’s decision to cross list on a more (or less) prestigious stock exchange relative to its own domestic market. We use a network analysis methodology to derive broad market-based measures of prestige for 45 country or regional stock exchange destinations between 1990 and 2006. We find that firms cross listing in a more prestigious market enjoy significant valuation gains over the five-year period following the listing. In contrast, firms cross listing in less prestigious markets experience a significant valuation discount over this post-listing period. The reputation of the cross-border listing destinations is therefore a useful signal of firm value going forward. Our findings are consistent with the view that cross listing in a prestigious market enhances firm visibility, strengthens corporate governance, and lowers informational frictions and capital costs.

Keywords: cross-listings; network analysis (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
https://www.mdpi.com/1911-8074/8/1/150/pdf (application/pdf)
https://www.mdpi.com/1911-8074/8/1/150/ (text/html)

Related works:
Working Paper: Firm value and cross-listings: the impact of stock market prestige (2010) Downloads
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:gam:jjrfmx:v:8:y:2015:i:1:p:150-180:d:47217

Access Statistics for this article

Journal of Risk and Financial Management is currently edited by Prof. Dr. Michael McAleer

More articles in Journal of Risk and Financial Management from MDPI, Open Access Journal
Bibliographic data for series maintained by XML Conversion Team ().

 
Page updated 2019-04-20
Handle: RePEc:gam:jjrfmx:v:8:y:2015:i:1:p:150-180:d:47217