 The Certification Role of ListingsCSEF Working Papers from Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy Abstract: The model developed in this paper shows that differences in incentives of firms to list can have an impact on the decision of exchanges concerning the level of listing requirements they set, and on the gains obtained by firms when they list on an exchange with stringent listing requirements. When firms bear listing costs that are uncorrelated with their quality, changing the level of listing requirements or introducing additional segments with different listing requirements changes the distribution of listed firms and affects thereby indirectly the values of listed firms. This indirect effect can either enforce or weaken the direct impact of more precise information on the value of firms. If the difference in the incentives to list among firms of the same quality is small, the exchange might be induced to set a high level of listing requirements, which leads to a high information efficiency in the economy. If these differences are large, the exchange never sets a high level of listing requirements and efficiency is impeded. Keywords: listing; disclosure requirements; compliance costs (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:sef:csefwp:297 Access Statistics for this paper More papers in CSEF Working Papers from Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy Contact information at EDIRC. |
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