Institutional Environment and IPO Strategy: A Study of ChiNext in China
研究新兴市场中企业家如何应对不成熟的监管环境以推动公司上市，发现企业家会向风险投资提供大幅折价股份以换取上市审批便利，且与政府等有关系的风投获得更高回报，但这种制度租金随时间递减。
ABSTRACT Taking an institution-based view, we investigate how entrepreneurs respond to immature regulatory environments in order to be listed on stock markets in countries with an emerging economy. Unlike stock markets in developed countries, in emerging markets, gaining government approval for listing is a critical and more unpredictable process for entrepreneurs. Hence, entrepreneurs who are preparing for a public offering might give substantially discounted shares to venture capital (VC) investors. This will lead to higher investment returns in pre-IPO deals than those at earlier stages, which distorts the risk-return tradeoff found in developed markets. In particular, the VC investors affiliated with powerful organizations that can promise entrepreneurs preferential access to stock market gatekeepers will gain even higher pre-IPO investment returns. The associated additional institutional rents earned by VC investors, however, are expected to decrease over time, as the stock markets mature. Related hypotheses with regard to the investment timing, VC firm affiliations with government agencies, securities traders, and universities are tested using data from ChiNext in China (2009–2013). This study highlights that institutional factors impact the behavior of participants in emerging markets. It extends current theories derived almost exclusively from developed markets.