Revisiting 'Truth in Securities Revisited': Abolishing IPOs and Harnessing Private Markets in the Public Good

41 Pages Posted: 10 Jul 2012 Last revised: 7 Aug 2012

Date Written: August 7, 2012

Abstract

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.

Keywords: Public offerings

JEL Classification: G38

Suggested Citation

Pritchard, Adam C., Revisiting 'Truth in Securities Revisited': Abolishing IPOs and Harnessing Private Markets in the Public Good (August 7, 2012). U of Michigan Law & Econ Research Paper No. 12-010. Available at SSRN: https://ssrn.com/abstract=2103246 or http://dx.doi.org/10.2139/ssrn.2103246

Adam C. Pritchard (Contact Author)

University of Michigan Law School ( email )

625 South State Street
Ann Arbor, MI 48109-1215
United States
734-647-4048 (Phone)
734-647-7349 (Fax)

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