The Role of the Underlying Real Asset Market in REIT IPOs

A leading explanation for IPO cycles is time-varying supply and demand for the underlying assets of the firms that are considering going public. We test this hypothesis using REIT IPOs, taking advantage of the relative transparency of the underlying real asset markets. We document links between REIT IPO activity and both the conditions of the underlying real estate market and the price of REITs. We find no significant relation between the heat of the IPO market and post-IPO operating performance, implying homogeneous firm quality across IPO cycles. Finally, we show that lagged IPO proceeds are related to future increases in investment and in capacity utilization.     

Bootstrapping in small firms: An empirical analysis of change over time

While bootstrapping is widely utilized as a strategic practice of small firms and has been regarded in the entrepreneurship literature as an important topic of study, little has been done to link bootstrapping to organizational theory. This paper presents hypotheses and an empirical study regarding bootstrapping and organizational development for small firms. The results of the study indicate that different types of bootstrapping are utilized at different periods in the life of a small firm, and that the methods utilized coincide to some extent with organizational theory predictions.     

Active Institutional Shareholders and Costs of Monitoring: Evidence from Executive Compensation

Although evidence suggests that institutional investors play a role in monitoring management, not all institutions are equally willing or able to serve this function. We present a stylized model that examines the effects of institutional monitoring on executive compensation. The model predicts that institutions' influence on managers' pay-for-performance sensitivity and level of compensation is enhanced when institutions have lower implied costs of monitoring, but that these effects are attenuated when the firm-specific cost of monitoring is high. Our empirical results are broadly consistent with these implications, suggesting that independent investment advisors and investment company managers have advantages in monitoring firms' management.     

The Quiet Period Goes out with a Bang

We examine the expiration of the IPO quiet period, which occurs after the 25^th calendar day following the offering. For IPOs during 1996 to 2000, we find that analyst coverage is initiated immediately for 76 percent of these firms, almost always with a favorable rating. Initiated firms experience a five-day abnormal return of 4.1 percent versus 0.1 percent for firms with no coverage. The abnormal returns are concentrated in the days just before the quiet period expires. Abnormal returns are much larger when coverage is initiated by multiple analysts. It does not matter whether a recommendation comes from the lead underwriter or not.     

Reasons for lapse: the case of face‐to‐face donors

Face‐to‐face fundraising is attracting increasingly hostile media coverage in the United Kingdom in the run up to the publication of the Charities Act in 2004. Despite the antipathy comparatively little is known about how donors view this technique and why they might elect to terminate their support having been recruited by this medium. This paper reports the results of a survey of 4,800 face‐to‐face recruits, comparing the attitudes and profiles of both active and lapsed supporters. The results suggest that donors exhibit high levels of satisfaction with the recruitment process and lapse primarily because of a change in their financial circumstances rather than feelings of having being pressurised to offer their support. Copyright © 2004 Henry Stewart Publications     

Why Don't Issuers Get Upset About Leaving Money on the Table in IPOs?

One of the puzzles regarding initial public offerings (IPOs)is that issuers rarely get upset about leaving substantial amountsof money on the table, defined as the number of shares soldtimes the difference between the first-day closing market priceand the offer price. The average IPO leaves $9.1 million onthe table. This number is approximately twice as large as thefees paid to investment bankers and represents a substantialindirect cost to the issuing firm. We present a prospect theorymodel that focuses on the covariance of the money left on thetable and wealth changes. Our reasoning also provides an explanationfor a second puzzling pattern: much more money is left on thetable following recent market rises than after market falls.This results in an explanation of hot issue markets. We alsooffer a new explanation for why IPOs are underpriced.     

Differences between European and American IPO Markets

This brief survey discusses recent developments in the European initial public offering (IPO) market. The spectacular rise and fall of the Euro NM markets and the growth of bookbuilding as a procedure for pricing and allocating IPOs are two important patterns. Gross spreads are lower and less clustered than in the USA. Unlike the USA, some European IPOs, especially those in Germany, have when‐issued trading prior to the final setting of the offer price. Current research includes empirical studies on the valuation of IPOs and both theoretical and empirical work on the determinants of short‐run underpricing.     

Selection Biases in Complementary R&D Projects

This paper analyzes selection biases in the project choice of complementary technologies that are used in combination to produce a final product. In the presence of complementary technologies, patents allow innovating firms to hold up rivals who succeed in developing other system components. This hold‐up makes innovation rewards independent of project difficulties and firms excessively cluster their R&D efforts on a relatively easier technology in order to preemptively claim stakes on component property rights. This selection bias is persistent and robust to several model extensions. Implications for the optimal design of intellectual property rights are discussed.