This study uses a natural experiment resulting from the 1997 Securities and Exchange Commission rule mandating a change in the order handling rules (OHR) for all NASDAQ stocks to test whether secondary market structure affects IPO underpricing. We find that the increase in liquidity that the OHR...

We examine the effect on expected flotation costs of including co-managers in the underwriting syndicate. We consider five components of SEO flotation costs: announcement returns, underpricing, the probability of withdrawals, offering delays, and underwriting spreads. The results show that the...

Booth and Chua (1996) suggest that underpricing may boost secondary market liquidity of an initial public offering (IPO), but to date there is little evidence on this point. In this study, we employ ten measures of liquidity to explore whether the underpricing of IPOs boosts subsequent secondary...