The Berlin Stock Exchange in Imperial Germany - A Market for New Technology?
29 Pages Posted: 27 Apr 2015
Date Written: April 2015
Abstract
Analysing 474 cases of firms going public in the German capital between 1892 and 1913, we show that innovative firms could rely on the Berlin stock market as a source of financing. The data also reveal that initial public offerings (IPO) of innovative firms were characterized by particularly low underpricing, comparatively high first trading prices, and no long-run underperformance. We interpret these empirical results as evidence for the surprising fact that contemporary investors had rational expectations.
Keywords: industrialisation, innovation, IPO, stock exchange
JEL Classification: G14, N23
Suggested Citation: Suggested Citation
Lehmann, Sibylle and Streb, Jochen, The Berlin Stock Exchange in Imperial Germany - A Market for New Technology? (April 2015). CEPR Discussion Paper No. DP10558, Available at SSRN: https://ssrn.com/abstract=2599550
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