Do Retail Incentives Work in Privatizations?

A-Tier
Journal: The Review of Financial Studies
Year: 2008
Volume: 21
Issue: 5
Pages: 2061-2095

Score contribution per author:

1.341 = (α=2.01 / 3 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Twenty countries around the world have used $27 billion in incentives such as bonus shares and discounts to attract retail investors to participate in privatizations and to discourage them from flipping their shares. Our results show that incentives have performed well, increasing retail investor participation much more cost effectively than underpricing. Flipping is not only much reduced in the short term but remains cumulatively at least 15% lower after 1000 trading days. The expiration of bonus share plans is associated with a 6-day abnormal return of -1.0% and a long-term increase in trading volume. , Oxford University Press.

Technical Details

RePEc Handle
repec:oup:rfinst:v:21:y:2008:i:5:p:2061-2095
Journal Field
Finance
Author Count
3
Added to Database
2026-01-25