Higher first-year post-issue returns are associated with a significantly higher probability of follow-on equity issuance over the next 5 years. This result holds when we control for pre-issue returns and other factors known to affect the probability of equity issuance. The result is most...

This paper analyzes the effect of corporate debt offerings on stock prices. Straight debt offerings have non-positive price effects, while convertible debt offerings have significantly negative effects. Public utility mortgage (non-convertible) bond offerings have marginally negative effects,...

This paper examines the effects of improvement in creditors' rights protection on firms' financing choices and securities issuance. To address these issues, I exploit exogenous variation in creditors' rights protection induced by the staggered adoption of anti-recharacterization laws by some...

Firms in transition economies often suffer financial constraints. In Initial Public Offerings (IPOs), however, many newly listed Chinese firms raise funds in excess of what is originally planned. This paper examines whether the excess IPO funds are wasted on value-destroying spending or enable...

IPO firms with high-powered CEO incentive contracts have lower failure rates in the aftermarket. Economically, an interquartile change in the distribution of CEO pay translates in a reduction of the failure risk probability by approximately 21%. The Pay Gap between the CEO and its subordinate...

During IPO bookbuilding, issuers revise both the offer price and the number of shares (or equivalently, insider retention). These two percentage revisions are of comparable magnitude and are nearly uncorrelated. We show theoretically that revision to offer price and to retention capture...

This research considers the strategies on the initial public offering of company equity at the stock exchanges in the imperfect highly volatile global capital markets with the nonlinearities. We provide the IPO definition and compare the initial listing requirements on the various markets. We...

This paper examines whether debt retirement at the time of initial public offering (IPO) can stimulate firm growth. Our findings reveal that highly leveraged firms tend to use proceeds of IPOs to repay more existing debt. Then, increased debt capacity and reduced interest burden enable firms to...

Assuming benevolent managers, the debt-overhang problem suggests that distressed firms generally refrain from issuing equity. In contrast, agency theory predicts that distressed firm managers have strong self-interests to finance even deteriorating projects through equity issuance. This paper...

Firms have different choices of using equity issuance and cash flow to save. Empirically, we find three differences between savings from equity issuance and cash flow. First, firms may not increase or decrease the savings rates of equity issuance and cash flow at the same time. Second, the...