This paper examines the incentives from stock options for loss-averse employees subject to probability weighting. Employing the certainty equivalence principle, I built on insights from Cumulative Prospect Theory (CPT) to derive a continuous time model to value options from the perspective of a...

This paper examines the incentives from stock options for loss-averse employees subject to probability weighting. Employing the certainty equivalence principle, I built on insights from Cumulative Prospect Theory (CPT) to derive a continuous time model to value options from the perspective of a...

This paper examines the incentives from stock options for loss-averse employees subject to probability weighting. Employing the certainty equivalence principle, I built on insights from Cumulative Prospect Theory (CPT) to derive a continuous time model to value options from the perspective of a...

This paper examines the incentives from stock options for loss-averse employees subject to probability weighting. Employing the certainty equivalence principle, I built on insights from Cumulative Prospect Theory (CPT) to derive a continuous time model to value options from the perspective of a...

Our study investigates by which channels IPO underpricing impacts post-listing liquidity. Using a sample of IPOs undertaken on Euronext with diverse mechanisms, we show that when ownership structure is not influenced by initial underpricing, this underpricing still has a positive impact on...

This article looks at the usefulness of measuring a company's wealth and net income using the fair value method. In this regard, the key question--is fair value relevant?--can be analysed as follows: do fair value "accounting numbers" provide a better estimate of the value of a company and the...

This paper examines the effect of stock market conditions on the waiting time of initial public offering (IPO) candidates, from the date firms file a registration statement with the Securities and Exchange Commission (SEC) to the effective IPO date. I find that issuers are going public faster...

Because IPO mechanisms determine both the initial trading price and the allocation of newly-listed firms' shares, they have financial and strategic consequences for shareholders. For that reason, it is of interest to analyse the relative advantages and disadvantages of the different procedures...

Based on a sample of 15 European countries, this survey analyses various features of the European IPO (Initial Public Offering) market over the period from 1995 to 2004: listing requirements, IPO-mechanism choices, performance and secondary market liquidity. First, the comparison of national...

We investigate the link between employee ownership and price levels of stocks. Using a comprehensive sample of firms in the Société des Bourses Françaises (SBF) 120 Index from 2000 to 2007, we document a negative correlation between share price levels and employee ownership. This suggests...