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Die Fehlbewertung junger Aktiengesellschaften beim Gang an die Börse – Ursachen und wirtschaftspolitische Konsequenzen

Author

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  • Ploog Christine

    (Institut für Weltwirtschaft an der Universität Kiel, Düsternbrooker Weg 120,D - 24105 Kiel)

  • Stolpe Michael

    (Institut für Weltwirtschaft an der Universität Kiel, Düsternbrooker Weg 120, D – 24105 Kiel)

Abstract
This paper discusses policy options to reduce underpricing in initial public offerings (IPOs). It surveys recent theoretical insights into the causes and welfare implications of underpricing and reviews evidence on the signalling hypothesis, the winner’s curse model, the role of underwriters in assessing issuing firms’ future profitability and the genesis of speculative bubbles in IPO markets. The paper concludes that governments should curtail the abuse of market power in underwriting by prohibiting the allocation of shares to insiders and by reducing the incentives for investment banks to exploit underpriced share issues in order to cross-subsidise unrelated lines of business. Moreover, governments should seek to stabilize the IPO market by committing themselves to regular equal-sized issues of shares in government assets as part of a long-term privatisation programme.

Suggested Citation

  • Ploog Christine & Stolpe Michael, 2003. "Die Fehlbewertung junger Aktiengesellschaften beim Gang an die Börse – Ursachen und wirtschaftspolitische Konsequenzen," Zeitschrift für Wirtschaftspolitik, De Gruyter, vol. 52(1), pages 128-152, April.
    • Handle: RePEc:lus:zwipol:v:52:y:2003:i:1:p:128-152:n:8
    DOI: 10.1515/zfwp-2003-0108
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    Cited by:

    1. Stolpe, Michael, 2004. "Non-market interaction in primary equity markets: evidence from France and Germany," Kiel Working Papers 1211, Kiel Institute for the World Economy (IfW Kiel).
    2. Stolpe, Michael, 2003. "Learning and signalling in the French and German venture capital industries," Kiel Working Papers 1156, Kiel Institute for the World Economy (IfW Kiel).

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