Media Concern,Accounting Information Quality And IPO Underpricing

IPO underpricing(IPO underpricing)refers to the initial public offering of shares.The first day,its listing price is much higher than the issue price,so that return rate goes beyond the market average earnings on the first day.This phenomenon is called one of the “mystery of modern finance”.After several reforms,IPO underpricing on Chinese market is still much higher than the average level of developed countries.Faced with such huge first-day gains,the academic community and theorists become curious about the causes of high underpricing rate.However,there would be bottlenecks if the problem is explained by the traditional economic theory.Other external factors in the market such as investors,underwriters and supervisors have become the tools to study the cause of underpricing.With the rapid development of the information technology,the media plays a role as an intermediary in the dissemination of information.As a result,considered as a new reference factor,media attention have significant impacts on people's perspective and value judgments.Sometimes the media can also mobilize people's emotions,change the perceptual knowledge of the public even.The role of the news media in the capital market has become a hot topic.The research of media function in Chinese capital market is still in the early stage.The researchers hold different views on the explanation and analysis of the effects which media attention has on the stock price.Based on the above,this paper discusses how the relationship between media reports and IPO underpricing come into being from the perspective of accounting information quality.This not only enriches the theoretical research on the causes of IPO underpricing,but also can deeply analyze the impact path of media attention on IPO underpricing.The main content of this paper is divided into the following parts.The first part is introduction.This part introduces the research background,research significance,research content,the framework and the innovation of this paper.The second chapter is about the conceptual definition and literature review.This part summarizes the influencing factors of IPO underpricing from the aspects of "underpricing" in the primary market and "premium" in the secondary market,based on which the influence of accounting information quality and media attention have on IPO underpricing is also discussed.The third chapter is theoretical analysis and hypothesis.This section introduces the theory of media information,the theory of information asymmetry,the hypothesis of signal and so on,the current situation and theoretical mechanism of Chinese IPO market are analyzed,as well.The fourth part is the empirical research design,which includes sample selection and data source,variable definition and model construction.The fifth chapter is about the empirical test and the result analysis.Firstly,descriptive statistics and correlation analysis are carried out.Secondly,the research hypothesis is tested by multiple regression method.Thirdly,the mediating effect of accounting information quality is tested.Finally,the robustness test is carried out.The empirical research in this chapter mainly focuses on two aspects: one is the correlation between media attention variable and IPO underpricing in primary market and secondary market;the other is the mediating effect of accounting information quality on the correlation between media attention and IPO underpricing.In order to ensure the robustness of the study results,the explanatory variables were replaced to verify the results of the study.The sixth chapter includes conclusion and suggestion.This chapter summarizes the results above,the policy recommendations of the regulatory authorities and advice on the rational investment for investors.In addition,the limitations of this study and the future direction of in-depth study are pointed out.In this paper,all the successful IPO companies listed on the GEM and the Main Board from 2011 to 2015 are studied empirically and the following conclusions are drawn.The degree of media attention and the IPO underpricing rate in Chinese stock market shows obvious correlation.In order to maintain a good relationship with investors and strive to improve its visibility,even receive more attention and recognition from the market,media behavior is treated as an effective way to manage asset pricing.The accounting information quality is one of the most important factors affecting the degree of information asymmetry between issuer and investor,investor and investor.It is also one of the most important information affecting stock price volatility and yield.The operating efficiency can not be changed in the short term,the management of accounting information and media behavior can artificially lead the performance of stock prices to the corresponding higher than the basic value.Therefore,as the market pressure hypothesis,the upgrade of the media attention makes the IPO enterprise's accounting information quality decline to a certain extent,so,indirectly lead to the phenomenon of anomaly high IPO underpricing.The main contributions of this paper are as follows.Firstly,the factors that affect IPO underpricing and the mechanism of action are analyzed from the aspects of “underpricing” of primary market and the “premium” of secondary market.Secondly,this paper attempts to enrich the theory of the causes of IPO underpricing,considering the information asymmetry theory and behavioral finance theory.We choose the accounting information quality and media attention to measure the effect of market information symmetry on IPO underpricing.Thirdly,this paper designs two paths to research the impacts of accounting information quality and media reports on IPO underpricing in primary and secondary markets.The research results of this paper enrich the application of theories on IPO underpricing on the basis of the existing research.Considering the theories of capital market efficiency,information asymmetry and behavioral finance,this paper has theoretically offered advice to define the primary market pricing and secondary stock market.The research results from the aspects of accounting information quality and media coverage will provide a specific monitoring path for the regulatory authorities to effectively enhance the accounting information quality and standardize the media rational reporting,thereby enhancing the effectiveness of the capital market.To provide investors with rational investment guidance,and reduce the spread of irrational emotions through the quality of the relevance of accounting information,reliability,understandability,and media coverage of the objectivity,authenticity,propensity.