Firm Value, the Sarbanes-Oxley Act and Cross-Listing in the US, Germany and Hong Kong Destinations
38 Pages Posted: 15 Apr 2009 Last revised: 14 Feb 2011
Date Written: November 10, 2010
Abstract
This paper presents empirical evidence on the effects of the Sarbanes-Oxley Act of 2002 on the value of firms and on the cross-listing choice of firms destined to three major markets in North America, Asia and Europe. We use dynamic panel data methods and treatment effects methods to find that Sarbanes-Oxley has had a negative impact on the value of firms worldwide. Our evidence indicates that Sox may have segmented markets, with fewer and more valuable firms seeking the more stringent US market; but many more lower valued firms destined to Hong Kong and Germany seeking potential signaling benefits of crosslisting.
Keywords: Cross-listing, Sarbanes-Oxley, dynamic panel data, treatment effects
JEL Classification: G0, G3
Suggested Citation: Suggested Citation
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