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Journal of Corporate Finance Vol. 27 2014

Robust determinants of IPO underpricing and their implications for IPO research

Alexander W. Butler1; Michael O’Connor Keefe2; Robert L. Kieschnick3

1 Rice University · 2 Victoria University of Wellington · 3 The University of Texas at Dallas

Abstract

Using several different methodologies, we quantify the statistical robustness of variables used in prior research to explain initial IPO returns. We establish a parsimonious list of robust variables and evaluate their implications for different theories of IPO underpricing and clustering. Further, we illustrate how using such a set of robust explanatory variables leads to several different conclusions than prior research that failed to include these important control variables. Researchers who identify new potential predictors of IPO initial returns should control for the list of robust variables we identify.

DOI
10.1016/j.jcorpfin.2014.06.002
Volume
27
Pages
367-383
Language
en
Sources
bibtex:phds-export.bib openalex crossref

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