Signaling organizational virtue: An examination of virtue rhetoric, country-level corruption, and performance of foreign ipos from emerging and developed economies

G. Tyge Payne, Curt B. Moore, R. Greg Bell, Miles A. Zachary

Research output: Contribution to journalArticle

44 Scopus citations

Abstract

Extending signaling theory by discussing rhetoric in terms of cost and observability, we examine the relationship between organizational virtue rhetoric in prospectuses and the performance of foreign IPOs from 35 different countries. We also explore how the nature of this relationship is contingent upon the level of perceived corruption for each IPO firm's home country, a pervasive and costly problem for emerging economy countries due to its impact on economic growth and national governance. Our results indicate that signaling organizational virtue in prospectuses leads to higher levels of foreign IPO performance, which is positively moderated by perceived home country corruption.

Original languageEnglish
Pages (from-to)230-251
Number of pages22
JournalStrategic Entrepreneurship Journal
Volume7
Issue number3
DOIs
StatePublished - Sep 2013

Keywords

  • Corruption
  • Emerging economies
  • Ethics
  • Foreign IPOs
  • Organizational virtue
  • Signaling theory
  • Underpricing

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