Stock Issue Price and the Entrepreneur’s Information Manipulation

Xiao Qiang Yu; Shan Cun Liu

doi:10.4028/www.scientific.net/AMR.430-432.1183

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Research of the Admixture Influence Cement Stabilized Macadam Vibrating Compaction Effect
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Prediction Algorithm of Spectral Reflectance of Spot Color Ink Based on Color Parallel and Superposition Model
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Stock Issue Price and the Entrepreneur’s Information Manipulation
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Application of DSM Topological Sort Method in Business Process
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Sustainable Development Theory of the Natural Step Appling Research in China Manufacturing Industry
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Research on Emission Control of Marine Diesel Engine
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Designment Algorithm on Orthogonal Two-Directional Vector-Valued Wavelets with Three-Scale Dilation Factor
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HomeAdvanced Materials ResearchAdvanced Materials Research Vols. 430-432Stock Issue Price and the Entrepreneur’s...

Stock Issue Price and the Entrepreneur’s Information Manipulation

Abstract:

Considering information asymmetry between the entrepreneur and external investors, this paper makes a hypothesis that the entrepreneur would manipulate information when issuing shares, and derives a stock issue price model based on information manipulation and effort the entrepreneur would make. Analysis of the model shows the level of information manipulation does affect the stock issue price. Market regulators should improve the capacity of identifying information manipulation and increase penalties for manipulators, so that the market can be more accurately pricing shares being issued.