IPOs and Product Quality.

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Stoughton, Neal M; Wong, Kit Pong; Zechner, Josef;
  • Journal: Journal of Business, volume 74, issue 3 July, pages 375-408
  • Related identifiers: doi: 10.1086/321931

Given recent public attention paid to high-flying Internet IPOs such as Yahoo and Amazon.com, we explore a product market motive for going public. We develop a model where consumers discern product quality from the stock price. The model predicts that only better-qualit... View more
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