Narcissistic managers and IPO underpricing |
| |
| Institution: | 1. Shanghai Business School, Shanghai, China;2. Zhongnan University of Economics and Law, Wuhan, China;3. Hong Kong Baptist University, Kowloon, Hong Kong;1. Joint Research Centre of the European Commission (JRC), Via E. Fermi 2749, 21027 Ispra (VA), Italy;2. University of Edinburgh Business School, 29 Buccleuch Pl, Edinburgh EH8 9JS, United Kingdom;3. Queen''s University Belfast, Queen''s Management School, 185 Stranmillis Road, Belfast, Northern Ireland BT9 5EE, United Kingdom;4. University College Dublin Michael Smurfit Graduate School of Business, Carysfort Ave, Carrysfort, Blackrock, Co. Dublin, Ireland;1. School of Economics and Management, Southwest Jiaotong University, Chengdu, China;2. College of Management, Yuan Ze University, Taoyuan, Taiwan;1. School of Accountancy, Shanghai University of Finance and Economics, China;2. Department of Finance, Huazhong University of Science and Technology, 1037 Louyu Road, Wuhan 430074, China;3. Department of Accounting, School of Management, Jinan University, China;1. Chongyang Institute for Financial Studies, Renmin University of China, 6th Floor, Culture Building, No.59 Zhongguancun Avenue, Haidian District, Beijing 100872, China;2. School of Finance, Renmin University of China, Room 812, Mingde Building, No. 59 Zhongguancun Avenue, Haidian District, Beijing 100872, China;1. Université de Montréal, Canada;2. HEC Montréal, Canada;1. School of Management, The University of Bradford, Richmond Road, Bradford BD7 1DP, United Kingdom;2. Huddersfield Business School, University of Huddersfield, Queensgate, Huddersfield HD1 3DH, United Kingdom |
| |
| Abstract: | Using hand-collected data on the signature size of managers in Chinese initial public offerings (IPOs) from 2007 to 2019 as a proxy for managerial narcissism, we examine how IPOs with narcissistic managers (narcissistic IPOs) affect IPO underpricing. The findings suggest that narcissistic IPOs have higher underpricing than non-narcissistic IPOs. Specifically, we find that on average, a narcissistic IPO exhibits approximately 11.3% higher underpricing than a median IPO firm. Our results are robust to alternative metrics of narcissism and underpricing after controlling for endogeneity. Additional analyses suggest that narcissistic IPOs are more likely to engage in earnings management than non-narcissistic IPOs. The former exhibits excessive risk-taking behavior, gauged by earnings volatility pre-IPO and a higher beta post-IPO. In the cross-sectional analyses, we document that the impact of managerial narcissism on IPO underpricing is more salient for IPOs facing unsophisticated investors, high market sentiment, or poor corporate governance. |
| |
| Keywords: | |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
