Chen, Hsuan-Chi; Jhou, Cyuan-Jhan; Yeh, Hsiu-Chuan - In: Applied Economics 39 (2007) 15, pp. 1973-1983
Underwriters in Taiwan have to purchase 10-25% of shares offered in initial public offerings (IPOs) for their own accounts. We present a signalling model showing that the underwriter retention rate can serve as a signal of firm value to investors because underwriters are investors as well. This...