Tag Archives: manufacturing

The Changing Universe of Public Companies

A new article in Knowledge@Wharton highlights a body of research that suggests that the universe of public companies is very different than in the past.  There are, for example, 44% fewer publicly-listed companies on U.S. exchanges than there were only fifteen years ago.  The Wharton article is a review of a range of work, including both experts who believe that we are seeing a decline in the role and significance of public firms and those who conclude that we are seeing a natural part of the business cycle.  In the late 90’s, it seemed as though every small company, with or without a proven product of earnings, was rushing to cash in on IPO fever.  Many of these companies subsequently failed.  Today, after a decade of weak market performance and with individual investors increasingly skeptical of the stock market, it is not surprising that fewer firms are going public.  The Wharton article also cites increased oversight and regulation of public companies as encouraging firms to remain private. Continue reading