The effect of the registration-based IPO reform on price efficiency: evidence from China

Based on the event-study methodology, this study investigates the effect of China's milestone registration-based initial public offering (IPO) system reform on stock price efficiency and price discovery. Our findings indicate that the reform improves price efficiency in the short and long term. Price discovery under the registration-based IPO system is stronger than under the approval system. Additionally, the reform's effect on investor sentiment and institutional transaction costs can affect price efficiency and price discovery.