Why do firms make an additional cross-listing? An empirical investigation using multiple failure time model

This paper aims to understand the recurrence of the cross-listing event using a unique and comprehensive sample of multiple cross-listed firms. By implementing multiple event-time experiment using an appropriate extension of the Cox (J R Stat Soc Ser B 34(2): 187–222, 1972) model, we find no evidence to support the bonding and the market segmentation hypothesis. However, firms, especially those from developed countries, list their shares in multiple foreign markets to commit themselves to higher information disclosure requirements, and to benefit from cross-listing in proximate geographic foreign markets. Firms that produce internationally tradable goods are also more likely to cross-list in additional foreign market to develop their global business strategy. Empirical analysis further show a significant explanatory power of market structure consideration in that firms go primarily to order-driven markets.