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A Note on Firms' Strategic Behaviour During an IPO

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  • Pia Weiß
  • Stefan Mai

Abstract

When potential shareholders cannot observe the business conditions of the firms, the latter desiring to acquire capital by an IPO and operating under less favourable business conditions have a strong incentive to appear more successful.

Suggested Citation

  • Pia Weiß & Stefan Mai, 2002. "A Note on Firms' Strategic Behaviour During an IPO," IWP Discussion Paper Series 01/2002, Institute for Economic Policy, Cologne, Germany.
    • Handle: RePEc:kln:iwpdip:dp01/02
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    References listed on IDEAS

    as
    1. Catherine Casamatta, 2003. "Financing and Advising: Optimal Financial Contracts with Venture Capitalists," Journal of Finance, American Finance Association, vol. 58(5), pages 2059-2085, October.
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    3. Jeng, Leslie A. & Wells, Philippe C., 2000. "The determinants of venture capital funding: evidence across countries," Journal of Corporate Finance, Elsevier, vol. 6(3), pages 241-289, September.
    4. Bergemann, Dirk & Hege, Ulrich, 1998. "Venture capital financing, moral hazard, and learning," Journal of Banking & Finance, Elsevier, vol. 22(6-8), pages 703-735, August.
    5. Trester, Jeffrey J., 1998. "Venture capital contracting under asymmetric information," Journal of Banking & Finance, Elsevier, vol. 22(6-8), pages 675-699, August.
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    7. Cornelli, F. & Yosha, O., 1997. "Stage Financing and the Role of Convertible Debt," Papers 23-97, Tel Aviv.
    8. Cornelli, Francesca & Yosha, Oved, 1997. "Stage Financing and the Role of Convertible Debt," CEPR Discussion Papers 1735, C.E.P.R. Discussion Papers.
    9. Gompers, Paul A., 1998. "Venture capital growing pains: Should the market diet?," Journal of Banking & Finance, Elsevier, vol. 22(6-8), pages 1089-1104, August.
    10. Berglof, Erik, 1994. "A Control Theory of Venture Capital Finance," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 10(2), pages 247-267, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    IPO; asymmetric information; signalling game;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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    This paper has been announced in the following NEP Reports:

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