Revisiting 'Truth in Securities Revisited': Abolishing IPOs and Harnessing Private Markets in the Public Good
Adam C. Pritchard
University of Michigan Law School
August 7, 2012
U of Michigan Law & Econ Research Paper No. 12-010
This essay explores the line between private and public markets. I propose a two-tier market system to replace initial public offerings. The lower tier would be a private market restricted to accredited investors; the top tier would be a public market with unlimited access. The transition between the two markets would be based on issuer choice and market capitalization, followed by a seasoning period of disclosure and trading in the public market before the issuer would be allowed to make a public offering. I argue that such system would promote not only efficient capital formation, but also investor protection.
Number of Pages in PDF File: 41
Keywords: Public offerings
JEL Classification: G38
Date posted: July 10, 2012 ; Last revised: August 7, 2012
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