The Efficiency of Direct Public Offerings

54 Pages Posted: 13 Oct 2003

See all articles by Anita Anand

Anita Anand

University of Toronto - Faculty of Law


One of the most powerful mechanisms by which governments and corporations can raise capital is by offering securities to the public without an underwriter through a direct public offering (DPO). Although governments at all levels have conducted DPOs, corporations generally have not adopted the DPO as a means of financing the corporation. This paper contends that DPOs can be a more efficient means of raising capital than conventional offerings. In particular, aggregate transaction costs in a DPO are likely to be lower in certain circumstances such as when: an offering is conducted over the Internet; the issuer is seasoned; investors are sophisticated; and, the offering is debt rather than equity securities. The presence of each of these factors can result in lower information costs and thereby increase the potential for an efficient DPO.

Keywords: offerings, underwriter, efficiency

JEL Classification: G3, KO, K2, O3

Suggested Citation

Anand, Anita, The Efficiency of Direct Public Offerings. Journal of Small & Emerging Business Law, Vol. 7, No. 3, 2003. Available at SSRN: or

Anita Anand (Contact Author)

University of Toronto - Faculty of Law ( email )

78 Queen's Park
Toronto, Ontario M5S 2C5
4169464002 (Phone)

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
PlumX Metrics