Capital market liability of foreignness of IPO firms

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Abstract

This study contributes to the capital market liability of foreignness (CMLOF) literature. Utilizing the context of foreign IPO firms, we investigate how long CMLOF lasts, if CMLOF turns into capital market advantage of foreignness (CMAOF) over time, if the global financial crisis influences CMLOF, and how some firms mitigate CMLOF after IPO. Utilizing an explanatory sequential mixed methods design, we quantitatively analyze 549 foreign IPO firms and qualitatively analyze 1233 units of data and show quantitatively that CMLOF does diminish after one year and turns into CMAOF after 3 years for IPO firms and qualitatively reveal strategies to mitigate CMLOF.
Original languageEnglish
Pages (from-to)555-567
Number of pages13
JournalJournal of World Business
Volume53
Issue number4
DOIs
StatePublished - Jun 1 2018

Keywords

  • Advantage of foreignness
  • Capital markets
  • Foreign initial public offerings
  • Global financial crisis of 2008
  • Liability of foreignness

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