Media legitimation effects in the market for initial public offerings

  • Pollock T
  • Rindova V
  • 366

    Readers

    Mendeley users who have this article in their library.
  • 371

    Citations

    Citations of this article.

Abstract

In this study, we argue that media-provided information affects investors’ impressions of newly public firms. In 225 initial public offerings (IPOs), the volume of media-provided information had a negative, diminishing relationship with underpricing and a positive, diminishing relationship with stock turnover on the first day of trading. The relationship between the tenor of media-provided information and underpricing in-creases at a nonlinear rate, and decreases similarly for turnover. Findings provide important evidence that publicly available information not only reflects IPOs’ legiti-macy, but also adds to their legitimacy and influences investor behavior.

Get free article suggestions today

Mendeley saves you time finding and organizing research

Sign up here
Already have an account ?Sign in

Find this document

Authors

  • Timothy G. Pollock

  • Violina P. Rindova

Cite this document

Choose a citation style from the tabs below

Save time finding and organizing research with Mendeley

Sign up for free