Trademark and IPO Underpricing

Posted: 19 Oct 2019

See all articles by Bin Yang

Bin Yang

City University of Hong Kong (CityUHK)

Tao Yuan

Nanjing University - School of Business

Date Written: August 1, 2019


This paper studies the relationship between a firm’s pre-IPO trademarks and its IPO under-pricing. Using 4,321 US IPOs during the period 1980-2016, we find that firms with a larger number of trademarks prior to the IPO date experience significantly less IPO under-pricing. We employ the 1996 Federal Trademark Dilution Act as a quasi-natural experiment and an instrumental variable approach to establish the causality. Our findings are in line with that trademarks reduce IPO under-pricing through signaling firm quality.

Keywords: Trademark; IPOs Underpricing, Information Asymmetry, Signaling

JEL Classification: G14, G24, O30, O34

Suggested Citation

Yang, Bin and Yuan, Tao, Trademark and IPO Underpricing (August 1, 2019). Available at SSRN:

Bin Yang

City University of Hong Kong (CityUHK) ( email )

83 Tat Chee Avenue
Hong Kong

Tao Yuan (Contact Author)

Nanjing University - School of Business ( email )

22 Hankou Road
Nanjing, Jiangsu 210093 210093

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