Authors: Thomas O'Connor
Addresses: Department of Economics, Finance and Accounting, National University of Ireland Maynooth, Maynooth, Co. Kildare, Ireland
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.
Keywords: cross-listing premia; investor recognition; legal bonding; emerging markets; Tobin's q.
International Journal of Accounting and Finance, 2014 Vol.4 No.3, pp.209 - 239
Received: 09 Nov 2012
Accepted: 08 Sep 2013
Published online: 08 Dec 2013 *