Discussion Paper Details

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Title: The Berlin Stock Exchange in Imperial Germany ? a Market for New Technology?

Author(s): Sibylle Lehmann and Jochen Streb

Publication Date: April 2015

Keyword(s): industrialisation, innovation, IPO and stock exchange

Programme Area(s): Economic History

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.

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Bibliographic Reference

Lehmann, S and Streb, J. 2015. 'The Berlin Stock Exchange in Imperial Germany ? a Market for New Technology?'. London, Centre for Economic Policy Research.