Evidence of Information Spillovers in the Production of Investment Banking Services

William Wilhelm, Lawrence M. Benveniste, Alexander Ljungqvist () and Xiaoyun Yu

No 2002-FE-06, Economics Series Working Papers from University of Oxford, Department of Economics

Abstract: We provide evidence that firms attempting IPOs condition offer terms and the decision whether to carry through with an offering on the experience of their primary market contemporaries. Moreover, while initial returns and IPO volume are positively correlated in the aggregate, the correlation is negative among contemporaneous offerings subject to a common valuation factor. Our findings are consistent with investment banks implicitly bundling offerings subject to a common valuation factor to achieve more equitable internalization of information production costs and thereby preventing coordination failures in primary equity markets.

Date: 2002-01-01
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Related works:
Journal Article: Evidence of Information Spillovers in the Production of Investment Banking Services (2003)
Working Paper: Evidence of Information Spillovers in the Production of Investment Banking Services (2002)
Working Paper: Evidence of Information Spillovers in the Production of Investment Banking Services (2001)
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