The Penny Stock Reform Act of 1990 (PSRA) was an attempt to curb fraudulent security issues by placing severe restrictions on initial public offerings that were priced below $5. The regulation had the cosmetic effect of reducing the number of initial public offerings priced below $5 but had no...

Examines the underpricing of initial public offerings (IPOs) and the impact of this underpricing on investor uncertainty and on the investment bankers who take the firms public. The firms going public lack the credibility to assert that the offering price is below the expected market price...

Our study documents a “Lemons” market failure of Chinese firms listed in the US in 2011 and a subsequent rebound by 2013. Our tests reveal that there was little difference in ex ante observable characteristics of fraudulent and non-fraudulent Chinese firms listed in the US prior to 2011...