Stand-by and best-effort underwriting mechanisms are the major ones that have been adopted in China. There are rarely comparative studies on the two mechanisms. This paper showed that the difference concerning underpricing between stand-by and best-effort underwritings is not significant, which indicated that the stand-by mechanism reform’s policy effect was not evident. Therefore, further reform measure shall be taken to solve the long-lasting extremely high underpricing problem and make the market more efficient.
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