Proceedings of the 2021 International Conference on Financial Management and Economic Transition (FMET 2021)

A Study of IPO Underpricing Using Regression Model Based on Information Asymmetry, Media, and Institution

Authors
Liangda Liu, Zixuan Zhang, Kexin Lyu
Corresponding Author
Kexin Lyu
Available Online 18 September 2021.
DOI
10.2991/aebmr.k.210917.051How to use a DOI?
Keywords
IPO underpricing, information asymmetry theory, Investor sentiment theory, government control
Abstract

This paper reviews the empirical studies of IPO underpricing, with an emphasis on Chinese stock market. It surveys the driving factors of IPO underpricing using the fitting regression analysis and disaggregate model. The studies have been sorted into three categories: information asymmetry, media coverage, and institutional factors. From the information asymmetry, this paper reviews five information asymmetry theories and uses the empirical analysis of the Winner’s Curse as the basis. It also lists the implications of some information asymmetry theories on various fields in the economy. In terms of media coverage, we used control variate model to analyse influence of each factor. It has been found that both media attention and media tone will affect investor sentiment and thus affect IPO underpricing. Therefore, to reduce the IPO underpricing rate, enterprises can carry out media information management to increase the proportion of negative tone in media reports. In the last section, we use linear regression model and discovered that IPO underpricing phenomenon was significantly correlated with institutional control and speculation behavior.

Copyright
© 2021, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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Volume Title
Proceedings of the 2021 International Conference on Financial Management and Economic Transition (FMET 2021)
Series
Advances in Economics, Business and Management Research
Publication Date
18 September 2021
ISBN
978-94-6239-432-2
ISSN
2352-5428
DOI
10.2991/aebmr.k.210917.051How to use a DOI?
Copyright
© 2021, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Cite this article

TY  - CONF
AU  - Liangda Liu
AU  - Zixuan Zhang
AU  - Kexin Lyu
PY  - 2021
DA  - 2021/09/18
TI  - A Study of IPO Underpricing Using Regression Model Based on Information Asymmetry, Media, and Institution
BT  - Proceedings of the 2021 International Conference on Financial Management and Economic Transition (FMET 2021)
PB  - Atlantis Press
SP  - 322
EP  - 333
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.210917.051
DO  - 10.2991/aebmr.k.210917.051
ID  - Liu2021
ER  -