Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/317486 
Year of Publication: 
2021
Citation: 
[Journal:] Journal of Business Economics and Management (JBEM) [ISSN:] 2029-4433 [Volume:] 22 [Issue:] 2 [Year:] 2021 [Pages:] 537-556
Publisher: 
Vilnius Gediminas Technical University, Vilnius
Abstract: 
Listing markets have different cultural backgrounds and experience different economic development. This study examines the impact of cultural values and the moderating effect of economic growth on IPO underpricing issued by Chinese companies in different stock markets. Using a sample of 2429 IPOs issuing in four different stock markets for the 2000-2018 period, the results suggest that in markets with higher power distance or longer-term orientation, IPOs experience higher underpricing; in markets with higher uncertainty avoidance scores, masculinity, individualism, or indulgence, IPOs experience lower underpricing. The greater the multidimensional cultural distance is to the Chinese A-share market, the less underpricing IPOs experience. Economic growth has a significant moderating effect, thereby intensifying or restraining the relationship between culture and IPO underpricing. The additional analysis considering cross-listing companies, and the robustness tests considering alternative measures of culture further support the above conclusions. This study highlights the cultural and economic factors motivating IPO underpricing, can help managers select listing markets from cultural and economic perspective.
Subjects: 
IPO underpricing
cultural values
economic growth
investor behaviour
listing markets
Chinese companies
JEL: 
G15
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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