To What Extent do Cross-Listing Firms Integrate into the U.S. Environment?

60 Pages Posted: 5 Mar 2010 Last revised: 16 Mar 2012

See all articles by Carolina Salva

Carolina Salva

University of Neuchatel

Laurent Frésard

University of Lugano; Swiss Finance Institute

Date Written: February 2012


We compare the value of firms that are cross-listed on U.S. exchanges to that of similar U.S. firms, and find a sizeable “cross-listing discount”. Over the period 1989-2006, cross-listed firms are valued 14% lower than U.S. firms. This valuation gap is strong, present across time and countries, is sustained over the cross-listing life-time. While the U.S. environment provides cross-listed firms with various benefits, their integration in the U.S. has limits. Examining the nature of these limits, we show that systematic differences in firm-level governance account for half of the discount. Furthermore, the cross-listing discount largely depends on whether cross-listed firms are familiar to U.S. investors.

Keywords: Cross-listing, Valuation, Familiarity, Home Bias, Corporate Governance, International Finance, Financial Integration

JEL Classification: G15, G34, G31

Suggested Citation

Salva, Carolina and Frésard, Laurent, To What Extent do Cross-Listing Firms Integrate into the U.S. Environment? (February 2012). Available at SSRN: or

Carolina Salva

University of Neuchatel ( email )

AL Breguet 2
CH-2000 Neuchatel

Laurent Frésard (Contact Author)

University of Lugano ( email )

Lugano, 900

Swiss Finance Institute ( email )

c/o University of Geneva
40, Bd du Pont-d'Arve
CH-1211 Geneva 4

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