Going-Private Decisions and the Sarbanes-Oxley Act of 2002: A Cross-Country Analysis
AbstractThis article investigates whether the passage and the implementation of the Sarbanes-Oxley Act of 2002 (SOX) drove firms out of the public capital market. To control for other factors affecting exit decisions, we examine the post-SOX change in the propensity of American public targets to be bought by private acquirers rather than public ones with the corresponding change for foreign public targets, which were outside the purview of SOX. Our findings are consistent with the hypothesis that SOX induced small firms to exit the public capital market during the year following its enactment. In contrast, SOX appears to have had little effect on the going-private propensities of larger firms. (JEL G30, G34, G38, K22) The Author 2008. Published by Oxford University Press on behalf of Yale University. All rights reserved. For permissions, please email: email@example.com, Oxford University Press.
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Bibliographic InfoArticle provided by Oxford University Press in its journal The Journal of Law, Economics, & Organization.
Volume (Year): 25 (2009)
Issue (Month): 1 (May)
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Postal: Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK
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Web page: http://jleo.oupjournals.org/
Find related papers by JEL classification:
- G30 - Financial Economics - - Corporate Finance and Governance - - - General
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
- G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
- K22 - Law and Economics - - Regulation and Business Law - - - Business and Securities Law
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- Dhammika Dharmapala & Vikramaditya Khanna, 2014. "The Costs and Benefits of Mandatory Securities Regulation: Evidence from Market Reactions to the JOBS Act of 2012," CESifo Working Paper Series 4796, CESifo Group Munich.
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