What are the possible reasons for IPO underpricing?

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1. How does a rights offering differ from a shelf offering?
2. Explain the winner’s curse. Does it apply only to IPO shares, or could it also apply to an auction for a one-of-a-kind painting?
3. What are the possible reasons for IPO underpricing?
4. What is the empirical evidence on the long-run performance of IPOs?

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