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Legal bonding, investor recognition, and cross-listing premia in emerging markets

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  • Thomas O'Connor

Abstract

Using the IFC investable measure to designate firms as either investable or non-investable prior to cross-listing, this paper shows Level 2/3 cross-listing firms that were previously non-investable enjoy the largest 'cross-listing premia'. Since previously non-investable firms are likely to experience the largest increase in their shareholder base post-listing, the results are consistent with the notion that enhanced 'recognition' explains cross-listing premia. For these firms, a combination of bonding and greater recognition serves to deliver large cross-listing premia. For previously investable firms, bonding alone is sufficient to deliver cross-listing premia.

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Bibliographic Info

Article provided by Inderscience Enterprises Ltd in its journal Int. J. of Accounting and Finance.

Volume (Year): 4 (2014)
Issue (Month): 3 ()
Pages: 209-239

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Handle: RePEc:ids:intjaf:v:4:y:2014:i:3:p:209-239

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Web page: http://www.inderscience.com/browse/index.php?journalID=231

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Keywords: cross-listing premia; investor recognition; legal bonding; emerging markets; Tobin's q.;

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