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Underpricing and Intellectual Capital Disclosure: Evidence from Indonesia

Author

Listed:
  • Wahyu Widarjo
  • Rahmawati
  • Bandi
  • Ari Kuncara Widagdo

Abstract

In this study, we investigate the relationship between intellectual capital disclosure and underpricing. We did interviews and gave questionnaires to practitioners and academics to develop intellectual capital disclosure measurement methods (in this case, it is the weighted disclosure index). The analysis result of 189 companies which did initial public offerings in Indonesia during 2000–2014 shows that intellectual capital disclosure affects negatively on underpricing. It indicates that intellectual capital disclosure can reduce asymmetry information between the issuer and the potential investor. In addition, intellectual capital disclosure can assist potential investors in assessing the company’s quality and prospects.

Suggested Citation

  • Wahyu Widarjo & Rahmawati & Bandi & Ari Kuncara Widagdo, 2020. "Underpricing and Intellectual Capital Disclosure: Evidence from Indonesia," Global Business Review, International Management Institute, vol. 21(6), pages 1325-1337, December.
    • Handle: RePEc:sae:globus:v:21:y:2020:i:6:p:1325-1337
    DOI: 10.1177/0972150919857017
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    References listed on IDEAS

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