This study develops an empirical algorithm within which the incentive for signaling of private information in course of IPOs is implemented as a conditional, as opposed to an unconditional incentive. Suppose high quality issuers of IPOs signal private information, and suppose presence of cohorts...

Suppose IPO underpricing increases with underwriters' reputation. This study demonstrates higher underpricing is compatible with higher credibility of underwriting by reputable underwriters. Consistent with stated inference, increase in valuation uncertainty risk, and severity of adverse...

The formal theoretical model in this study explicitly establishes the following results. Suppose the distribution of IPO quality either is time invariant, or equivalently, that distributions for IPO underpricing and underwriting spreads are explicitly conditioned on realizations of IPO quality....