Bresearch On Imitated Behavior Of Underwriter Selecting IPO From Listed Company

The underwriter in IPO market is the intermediary agents for the whole stock market, which plays an important role in keeping the steady development for the market. The purpose of this paper is to provide some analysis on how firms choose their underwriter in IPO market under the influence of imitation. This paper focuses on the definition and importance of imitation, and how different types of imitation works. Considering the current situation in which Chinese listed firms choose their underwriter through IPO procedure, this paper emphasizes three different types of imitation. In this paper, IPO cases of A-share listed firms from1990to2012in Shanghai and Guangzhou are taken as initial samples. Through analysis on those samples, the way firms select underwriter through imitation is studied.This paper aims at enriching researches on firms’choosing IPO underwriter, so to deepen the understanding of imitation. This paper begins with illustrating theories, then summary Chinese firms’behavior when selecting IPO underwriter through studying three types of imitation. Eventually, a more comprehensive understanding is formed.Through the theoretical analysis based on empirical study, this paper analyzes three different types of imitation:first, frequency imitation; second, characteristic imitation; third, outcome imitation. The frequency imitation means organizations tend to copy actions that many organizations have already taken before. The characteristic imitation refers to that organizations will use actions taken by companies with some certain characteristics, like large scale, etc. The outcome imitation refers to that organizations tend to imitate actions that brought good outcomes to other groups, and avoid actions that brought bad results. Moreover, this paper goes further to predict uncertain factors that could modulate these types. In addition, although several existing paper points out the existence of three types of imitation, but a systematic empirical research which is able to test all patterns of imitation in a single environment is still absent. Besides, those factors that can affect the relative effect between them also require us to give a comprehensive and substantial research.According to the conclusion provided by this paper, we can realize the importance of making use of imitation theory in choosing a qualified underwriter during IPO procedure, which would increase the depth and breadth of the study on domestic underwriters behavior, contribute to improve relative theories, and provide suggestion on how to choose underwriter for listed firms in China.