IS IT REALLY A BONDING, AN AVOIDANCE, OR A CHARACTERISTICS CHOICE? AN ANALYSIS OF FOREIGN LISTING ON LOW VERSUS HIGH INVESTOR PROTECTION MARKETS

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Abstract

We investigate the difference in the characteristics of firms that cross-list on high versus low investor protection markets. We find that civil law firms that cross-list on common law markets have higher growth rate, larger size and lower turnover pre cross-listing than their counterparts that cross-list on civil law markets. Also, we find that common law firms that cross-list on common law markets are larger and have a lower volume turnover than those that cross-list on civil law markets. Both groups experience a significant increase in their growth after cross-listing on common law markets. We also report that firms which have poor accounting standards, poor performance, are small in size, and from civil law countries are likely to cross-list on the US unregulated exchanges.

Keywords: Foreign Listing, Legal System, Investor Protection, Civil-Law, Common-Law, Regulated Exchanges, Unregulated Exchanges

How to cite this paper: AL-Nasser Abdallah, A., & Abdallah, W. (2014). Is it really a bonding, an avoidance, or a characteristics choice? An analysis of foreign listing on low versus high investor protection markets. Corporate Ownership & Control, 12(1-9), 820-835. https://doi.org/10.22495/cocv12i1c9p6