| Abstract: | This paper analyses the significance of administrative expenses incurred by a comprehensive sample of firms obtaining quotation on the Unlisted Securities Market and Official List in the 1980s. It is concerned with the extent to which barriers to entry in the new issue market arising from the existence of high fixed costs of obtaining a quotation established in previous research have been reduced as a result of the introduction of the USM. A comparative analysis is undertaken, examining the relative costs of new issues in the USM and the Official List, together with a study of whether total expenses are affected by the route chosen for ultimate progression to the Official List. The research examines the extent to which cost variation can be attributed to differences in characteristics of the issue and of the firms themselves so as to generate continuing and significant economies of scale. Finally, the paper considers briefly whether competition in the new issue market has been associated with a reduction over time in the real cost of expenses, or whether, as has been alleged, USM costs are again increasing at a faster rate than inflation. |
