| Article Information |
| Journal: |
Business and Economics Research Journal |
| Title of Article: |
Economic Policy Uncertainty and Fluctuations in Monthly IPO Volume: Evidence from the US |
| Author(s): |
Şenay Açıkgöz, Cem Onur Karatas |
| Volume: |
15 |
| Number: |
4 |
| Year: |
2024 |
| Page: |
331-354 |
| ISSN: |
2619-9491 |
| DOI Number: |
10.20409/berj.2024.448 |
|
| Abstract |
| This research examines the dynamic relationship between economic policy uncertainty (EPU) and initial public offering (IPO) volume in the United States from 1990 to 2020. Employing time-series econometric methods, we find that EPU has a significant negative effect on IPO activities. According to impulse responses, the number of IPOs significantly reacts to the innovations on EPU within the next 1 to 4 months and approaches the new equilibrium in 6 to 8 months. However, EPU does not contribute to forecast error variance decompositions of the number of IPOs. Our empirical results also show that the number of IPOs switches between low-mean/high-variance and high-mean/low-variance regimes. The results have some useful implications for timing IPOs in terms of economic policy uncertainty. |
| Keywords: |
Economic Policy Uncertainty, IPOs, VAR, Impulse-responses, Regime Change |
|
| JEL Classification: |
C22, C32, G10, G38 |
|
