Sarkissian, Sergei and Schill, Michael (2010): The Nature of the Foreign Listing Premium: A Cross-Country Examination.
This is the latest version of this item.
Download (258kB) | Preview
An expanding literature asserts that non-U.S. firms achieve a valuation premium for listing on U.S. equity markets. In this paper we examine the foreign listing premium across a global sample of exchange-listed foreign listings with particular emphasis on the top ten home markets and top ten host markets for foreign listings. We highlight that the documented valuation premium for listing on U.S. exchanges is not unique but common to many home and host markets including U.S. firms that list abroad. The cross-sectional variation in the valuation premium appears to have little association with any unique institutional features of the market; rather the premium is related to variation in pre-listing valuation ratios.
|Item Type:||MPRA Paper|
|Original Title:||The Nature of the Foreign Listing Premium: A Cross-Country Examination|
|English Title:||The Nature of the Foreign Listing Premium: A Cross-Country Examination|
|Keywords:||Cross listings; Firm valuation; Rule of law; Stock exchanges; Tobin’s Q|
|Subjects:||G - Financial Economics > G1 - General Financial Markets > G15 - International Financial Markets
G - Financial Economics > G3 - Corporate Finance and Governance > G32 - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
|Depositing User:||Sergei Sarkissian|
|Date Deposited:||05. Feb 2011 15:00|
|Last Modified:||12. Feb 2013 03:55|
Bancel, F., and U. R. Mittoo, 2001, European managerial perceptions of the net benefits of foreign listing: European evidence, European Financial Management 7, 213-236.
Baker, H., J. Nofsinger, and D. Weaver, 2002, International cross-listing and visibility, Journal of Financial and Quantitative Analysis 37, 495–521.
Benos, E., and M.S. Weisbach, 2004, Private benefits and cross-listings in the United States, Emerging Markets Review 5, 217-240.
Black, F., 1974, International capital market equilibrium with investment barriers, Journal of Financial Economics 1, 337-352.
Cantale, S., 1996, The choice of a foreign market as a signal, Working paper, INSEAD.
Chaplinsky, S., L. Ramchand, 2008, From listing to delisting: Foreign firms’ entry and exit from the U.S., Working paper, University of Virginia.
Coffee, J., 1999, The future as history: the prospects for global convergence in corporate governance and its implications, Northwestern Law Review 93, 641-708.
Coffee, J., 2002, Racing towards the top? The impact of cross-listings and stock market competition on international corporate governance, Working paper, Columbia University.
Djankov, S., R. La Porta, F. Lopez-de-Silanes, and Shleifer, 2008, The law and economics of self-dealing, Journal of Financial Economics 88, 430-465.
Doidge, C., 2004, U.S. cross-listings and the private benefits of control: Evidence from dual class firms, Journal of Financial Economics 72, 519-553.
Doidge, C., G.A. Karolyi, and R. Stulz, 2004, Why are foreign firms listed in the U.S. worth more?, Journal of Financial Economics 71, 205-238.
Doidge, C., G.A. Karolyi, and R. Stulz, 2007, Why do countries matter so much for corporate governance?, Journal of Financial Economics 86, 1-39.
Doidge, C., G.A. Karolyi, and R. Stulz, 2009, Why has New York become less competitive than London in global markets? Evaluating foreign listing choices over time, Journal of Financial Economics 91, 253-277.
Doidge, C., G.A. Karolyi, Lins, K., Miller, D., and R. Stulz, 2009, Private benefits of control, ownership, and the cross-listing decision, Journal of Finance 64, 425-466.
Domowitz, I., J. Glen, and A. Madhavan, 1998, International cross-listing and order flow migration: Evidence from an emerging market, Journal of Finance 53, 2001-2027.
Duarte, J., K. Yong, S. Siegel, L. Young, 2009, Foreign listings, US equity markets, and the impact of the Sarbanes-Oxley Act, Working paper, Rice University.
Errunza, V., and E. Losq, 1985, International asset pricing under mild segmentation: Theory and tests, Journal of Finance 40, 105-124.
Fernandes, N., and M. A. Ferreira, 2008, Does international cross-listing improve the information environment?, Journal of Financial Economics 88, 216-244.
Fernandes, N., and M. Giannetti, 2008, On the fortunes of stock exchanges and their reversals: evidence from foreign listings, Working paper, IMD and Stockholm School of Economics.
Foerster, S., and G.A. Karolyi, 1998, Multimarket trading and liquidity: a transaction data analysis of Canada-US interlistings, Journal of International Financial Markets, Institutions, and Money 8, 393-412.
Foerster, S., and G.A. Karolyi, 1999, The effects of market segmentation and investor recognition on asset prices: Evidence from foreign stocks listing in the United States, Journal of Finance 54, 981-1013.
Gozzi, J., R. Levine, and S. Schmukler, 2008, Internationalization and the evolution of corporate valuation, Journal of Financial Economics 88, 607-632.
Goto, S., M. Watanabe, and Y. Xu, 2009, Strategic disclosure and stock returns: Theory and evidence from U.S. cross-listing, Review of Financial Studies 22, 1585-1620.
Hail, L., and C. Leuz, 2006, International differences in cost of capital: Do legal institutions and securities regulation matter?, Journal of Accounting Research 44, 485-531.
Howe, J., and K. Kelm, 1987, The stock price impacts of overseas listings, Financial Management 16, 51-56.
Huddart, S., J. Hughes, and M. Brunnermeier, 1999, Disclosure requirements and stock Exchange listing choice in an international context, Journal of Accounting and Economics 26, 237–269.
King, M., and D. Segal, 2009, The long-term effects of cross-listing, investor recognition, and ownership structure on valuation, Review of Financial Studies 22, 2393-2422.
La Porta, R., F. Lopez-De-Silanes, A. Shleifer, and R. Vishny, 1997, Legal determinants of external finance, Journal of Finance 52, 1131-1150.
La Porta, R., F. Lopez-De-Silanes, A. Shleifer, and R. Vishny, 1998, Law and finance, Journal of Political Economy 106, 1113-1155.
Lang, M., K. Lins, and D. Miller, 2003, ADRs, analysts, and accuracy: Does cross listing in the U.S. improve a firm’s information environment and increase market value?, Journal of Accounting Research 41, 317-345.
Lau, S.T., J. Diltz, and V. Apilado, 1994, Valuation effects of international stock exchange listings, Journal of Banking and Finance 18, 743-755.
Lee, I., 1987, The impact of overseas listings on shareholder wealth: The case of the London and Toronto stock exchanges, Journal of Business Finance and Accounting 18, 583-592.
Levine, R., and S. Zervos, 1998, Stock markets, banks, and economic growth, American Economic Review 88, 537-558.
Licht, Amir N., Xi Li, and Jordan I. Siegel, 2011, What makes the bonding stock? A natural experiment involving the Supreme Court and cross-listed firms, Working paper Harvard Business School.
Lins, K., D. Strickland, and M. Zenner, 2005, Do non-U.S. firms issue stock on U.S. equity markets to relax capital constraints?, Journal of Financial and Quantitative Analysis 40, 2005, 109-133.
Litvak, K., 2007, Sarbanes-Oxley and the cross-listing premium, Michigan Law Review 105, 1857-1898.
Litvak, K., 2008, The long-term effect of Sarbanes-Oxley on cross-listing premia, European Financial Management Journal 14, 875-920.
Mittoo, U., 1992, Managerial Perceptions of the Net Benefits of Foreign Listings: Canadian Evidence, Journal of International Financial Management and Accounting 4, 40–62.
Mittoo, U., 2003, Globalization and the value of U.S. listing: Revisiting Canadian evidence, Journal of Banking and Finance 27, 1629-1661.
Moel, A., 1999, The role of information disclosure on stock market listing decisions: The case of foreign firms listing in the U.S., Working paper, Harvard Business School.
Pagano, M., A. Roell, and J. Zechner, 2002, The geography of equity listing: Why do European companies list abroad?, Journal of Finance 57, 2651-2694.
Reese, W., and M. Weisbach, 2002, Protection of minority shareholder interests, cross-listings in the United States, and subsequent equity offerings, Journal of Financial Economics 66, 65-104.
Sarkissian S., and M.J. Schill, 2004, The overseas listing decision: New evidence of proximity preference, Review of Financial Studies 17, 769-809.
Sarkissian S., and M.J. Schill, 2008, Cross listing waves, Working paper, McGill University and University of Virginia.
Sarkissian S., and M.J. Schill, 2009, Are there permanent valuation gains to overseas listing?, Review of Financial Studies 22, 371-412.
Siegel, J., 2004, Can foreign firms bond themselves effectively by renting U.S. securities laws?, Journal of Financial Economics, 75, 319-359.
Solnik, B., 1974, An equilibrium model of the international capital market, Journal of Economic Theory 18, 365-378.
Stulz, R., 1981, On the effects of barriers to international asset pricing, Journal of Finance 25, 783-794.
Stulz, R., 1999, Globalization, corporate finance, and the cost of capital, Journal of Applied Corporate Finance 12, 8-25.
Sundaram, A., and D. Logue, 1996, Valuation effects of foreign company listings on U.S. exchanges, Journal of International Business Studies 27, 67-88.
Tinic, S., and R. West, 1974, Marketability of common stocks in Canada and the USA: A comparison of agent versus dealer dominated markets, Journal of Finance 29, 729-746.
Torabzadeh, K., W. Bertin, and T. Zivney, 1992, Valuation effects of international listings, Global Finance Journal 3, 159-170.
Werner, I., and A. Kleidon, 1996, U.S. and U.K. trading of British cross-listed stocks: An intraday analysis of market integration, Review of Financial Studies 9, 619-664.
Available Versions of this Item
Why are U.S. firms listed in foreign markets worth more? (deposited 23. Dec 2010 21:25)
- The Nature of the Foreign Listing Premium: A Cross-Country Examination. (deposited 05. Feb 2011 15:00) [Currently Displayed]