Financial Innovation

Table 7 The impact of institutional quality measures on long-term performance

From: The impact of IFRS mandate and institutional governance on underpricing and aftermarket performance of IPO shares in Turkey

	Dependent variable is BHAR2Y
Post	− 0.611**	− 0.611**	− 0.741**	− 0.749**	− 0.757**	− 0.673**
	(− 2.201)	(− 2.072)	(− 2.213)	(− 2.228)	(− 2.294)	(− 2.231)
Treatment	− 0.200	− 0.087	− 0.366	− 0.383	− 0.332	− 0.274
	(− 0.719)	(− 0.274)	(− 1.146)	(− 1.217)	(− 1.042)	(− 0.934)
IFRS (Post*Treatment)	0.768***	0.593**	0.943***	0.998***	1.013***	0.894***
	(2.485)	(1.757)	(2.568)	(2.884)	(3.006)	(2.814)
Voice and accountability	− 0.332
	(− 1.452)
Political stability		− 0.469
		(− 1.166)
Government effectiveness			0.423
			(0.815)
Regulatory quality				0.243
				(0.522)
Control of corruption					− 0.010
					(0.021)
Rule of law						− 0.384
						(− 0.900)
Firm-level controls	Included	Included	Included	Included	Included	Included
Market-level Controls	Included	Included	Included	Included	Included	Included
IE	Included	Included	Included	Included	Included	Included
Observations	137	137	137	137	188	188
Adj. R²	0.389	0.388	0.386	0.383	0.382	0.385
Prob. of F-Statistics	0.000	0.000	0.000	0.000	0.000	0.000

The table presents the estimation results for the impact of institutional governance quality measures (6 measures obtained from the World Bank) on two years buy-and-hold (BHAR2Y) investment strategy. The estimation period is from 1998 to 2019. 2005 is excluded to avoid the probable impact of confounding forces during the transition year. Detailed definitions of variables are provided in Table 1. Numbers in parentheses are t-statistics adjusted according to Newey and West (1987). ***, and ** indicate statistical significance at 1%, and 5% level, respectively

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