Abstract
Abstract
Using an international sample of IPO firms and two country-level measures of financial literacy, we find strong evidence that financial literacy is negatively associated with IPO underpricing. In cross-sectional analyses, we find that the effect of financial literacy in reducing IPO underpricing is more pronounced when the information environment is less transparent. Employing path analysis, we document that information friction, firm transparency, and stock market participation are mechanisms that mediate this relationship. Our study contributes to and extends the literature by providing strong evidence that citizens’ financial literacy has an important and consistent influence on IPO underpricing.
Publisher
Cambridge University Press (CUP)
Subject
Economics and Econometrics,Finance,Accounting
Reference131 articles.
1. Testing for Weak Instruments in Linear IV Regression
2. Auditor Credibility and Initial Public Offerings;Menon;Accounting Review,1991
3. Measuring Financial Literacy
4. Debt literacy, financial experiences, and overindebtedness
5. Atkinson, A. , and Messy, F. . “Measuring Financial Literacy.” Technical Report, OECD (2012).
Cited by
2 articles.
订阅此论文施引文献
订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献