Organizational Debut on the Public Stage: Marketing Myopia and Initial Public Offerings

Successful initial public offerings (IPOs) provide firms with access to valuable resources, but also put pressure on firms to impress potential investors with evidence of their current well-being and prospects for future growth. To impress investors IPO firms might curtail their marketing budgets, which appears to inflate current earnings and provide evidence of current well-being. However, curtailing marketing budgets unexpectedly during an IPO...