Conservatism and international IPO underpricing

Boulton, Thomas J.; Smart, Scott B.; Zutter, Chad J.

doi:10.1057/s41267-016-0054-8

Cited by 69 publications

(61 citation statements)

References 60 publications

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“…Moreover, SWFs have a differential preference for private firms without a stock exchange listing, particularly in countries with lower legal standards (Johan, Knill, & Mauck, 2013), where the lack of transparency is suggestive of greater agency problems. Once companies become publicly listed, there is substantially more information released to the market, depending on the legal and cultural factors in a particular country (Boulton, Smart, & Zutter, 2017).…”

Section: Mobility Of Governancementioning

confidence: 99%

Law, finance, and the international mobility of corporate governance

et al. 2017

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We introduce the topic of this Special Issue on the ''Role of Financial and Legal Institutions in International Governance'', with a particular emphasis on a notion of ''international mobility of corporate governance''. Our discussion places the Special Issue at the intersection of law, finance, and international business, with a focus on the contexts of foreign investors and directors. Country-level legal and regulatory institutions facilitate foreign ownership, foreign directors, raising external financial capital, and international M&A activity. The interplay between the impact of foreign ownership and foreign directors on firm governance and performance depends on international differences in formal/regulatory institutions. In addition to legal conditions, informal institutions such as political connections also shape the economic value of foreign ownership and foreign directors. We highlight key papers in the literature, provide an overview of the new papers in this Special Issue, and offer suggestions for future research.

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Section: Mobility Of Governancementioning

confidence: 99%

Law, finance, and the international mobility of corporate governance

et al. 2017

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“…For instance, previous literature has suggested that the use of AC improved the investment efficiency of an organization (Lara et al 2016) and enhanced stock value during the crisis period (Francis et al 2013). It also helps in reducing the information asymmetries, which then improves IPO pricing (Boulton et al 2017). Scholars also discussed the negative impact of AC on firms.…”

Section: Introductionmentioning

confidence: 99%

Intellectual Structure and Evolution of Accounting Conservatism Research: Past Trends and Future Research Suggestions

Bhutta¹,

Martins

Mata

et al. 2021

IJFS

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Accounting conservatism (AC) is one of the components of financial reporting, and has been widely studied by academicians to identify its impact on information quality. Scholars in accounting have started to explore how AC is related to different fundamental functional areas of organizations. The interest of the scholars has resulted in an increasing number of publications in this field. In this study, we examined 408 indexed publications related to AC. This work’s objectives include analyzing the regional distribution, size, and evolution of this knowledge base by identifying key authors, documents, and journals while exploring current literature, scholarly structure, and highlighting contemporary trends. The findings of the study concluded that most of the studies are conducted in developed nations contexts. However, there are still areas that need further exploration to obtain more profound insights on the subject. This bibliometric review inspires a new generation of researchers on the topic by giving them an overview of the past studies related to AC.

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“…For the purpose of answering the research questions, both sentiment analysis and topic modelling of the textual corpus is performed. One of the most popular in the field of IPO research way to evaluate the tone of the text consists in using the pre-build vocabulary of words with some sentiment attributes and then counting the appearance of this words in the preprocessed text (Bajo and Raimondo, 2017;Boulton et al, 2017;Brau et al, 2016;Loughran and McDonald, 2013;Tetlock, 2007;Zou et al, 2020). However, this approach is flawed in a way that words from the vocabulary are taken separately, while in collocations they may IJAIM 30,1 acquire different meaning.…”

Section: Textual Analysismentioning

confidence: 99%

“…The tone of the text is evaluated with the help of bidirectional encoder representations from transformers (BERT) (Devlin et al, 2018) a state-ofthe-art language representation neural network model, which is pretrained for the purposes of sentiment analysis of financial texts. Using BERT is preferable to other sentiment analysis techniques, such as those based on a vocabulary (Bajo and Raimondo, 2017;Boulton et al, 2017;Brau et al, 2016;Loughran and McDonald, 2013;Tetlock, 2007;Zou et al, 2020), as it helps to avoid subjectivity when choosing a vocabulary and sees the text as a whole, as opposed to bag-ofwords approach.…”

Section: Introductionmentioning

confidence: 99%

Impact of news sentiment and topics on IPO underpricing: US evidence

Fedorova

Druchok

Drogovoz

2021

IJAIM

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Purpose The goal of the study is to examine the effects of news sentiment and topics dominating in the news field prior to the initial public offering (IPO) on the IPO underpricing. Design/methodology/approach The authors’ approach has several steps. The first is textual analysis. To detect the dominating topics in the news, the authors use Latent Dirichlet allocation. The authors use bidirectional encoder representations from transformers (BERT) pretrained on financial news corpus to evaluate the tonality of articles. The second is evaluation of feature importance. To this end, a linear regression with robust estimators and Classification and Regression Tree and Random Forest are used. The third is data. The text data consists of 345,731 news articles from Thomson Reuters related to the USA in the date range from 1 January 2011 to 31 May 2018. The data contains all the possible topics from the website, excluding anything related to sports. The sample of 386 initial public offerings completed in the USA from 1 January 2011 to 31 May 2018 was collected from Bloomberg Database. Findings The authors found that sentiment of the media regarding the companies going public influences IPO underpricing. Some topics, namely, the climate change and environmental policies and the trade war between the US and China, have influence on IPO underpricing if they appear in the media prior to the IPO day. Originality/value The puzzle of IPO underpricing is studied from the point of Narrative Economics theory for the first time. While most of the works cover only some specific news segment, we use Thomson Reuters news aggregator, which uses such sources The New York Post, CNN, Fox, Atlantic, The Washington Post ? Buzzfeed. To evaluate the sentiment of the articles, a state-of-the-art approach BERT is used. The hypothesis that some common narratives or topics in the public discussion may impose influence on such example of biased behaviour like IPO underpricing has also found confirmation.

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Conservatism and international IPO underpricing

Cited by 69 publications

References 60 publications

Law, finance, and the international mobility of corporate governance

Law, finance, and the international mobility of corporate governance

Intellectual Structure and Evolution of Accounting Conservatism Research: Past Trends and Future Research Suggestions

Impact of news sentiment and topics on IPO underpricing: US evidence

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