Friday, April 27, 2007
Academic Study on Foreign Private Issuers
The WSJ highlights an academic study that disputes the frequently-made assertion that Sarbanes Oxley caused foreign private issuers to flee the U.S. capital markets in favor of London. Instead, the study (authored by Craig Doidge of U. of Toronto and Andrew Karolyi and Rene Stulz of OSU) finds that the decline in foreign listings since 2002 reflects the fact that there are fewer foreign companies meeting the profile for U.S. listing. It also finds that U.S. investors are still willing to pay a premium for foreign stocks listed on the U.S. markets. See WSJ, Maybe U.S. Markets Are Still Supreme. The study is available at SSRN.