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IPO Timing Determinants
Abstract
Despite the extensive amount of IPO literature, many unknowns still exists about the
inner workings of the IPO process. This paper seeks to extend upon the literature
to first confirm whether the IPO market is an appropriate economic indicator. We
enhance the approach taken by previous studies with the addition of excess reserves
as a macroeconomic proxy to capture trends unique to the most recent recession. Our
findings provide support for capital demand, investor sentiment and stock market condition
as determinants of IPO fluctuations. The results also suggest that the
uncertainty surrounding the latest financial crisis has caused the average amount
of IPO proceeds to decrease. Secondly, the paper employs cross sectional data to examine
the transition from private to public company at the firm specific level. The size
of an offering seems to be dependent upon macroeconomic conditions as well as firm
specific characteristics. However, we were unable to find statistically significant
differences between firms who go public during a recession and those who wait for
markets to improve.
Type
Honors thesisDepartment
EconomicsPermalink
https://hdl.handle.net/10161/3556Citation
Blum, Rachel (2011). IPO Timing Determinants. Honors thesis, Duke University. Retrieved from https://hdl.handle.net/10161/3556.Collections
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