This dissertation includes two essays that study initial public offerings (IPO) earnings management. The first essay examines the underwriter's certification and monitoring roles in IPO earnings management; the second essay explores the relation between IPO earnings management and post-IPO institutional ownership. In the first essay, we investigate the certification role played by underwriters. We hypothesize that there is a negative relation between IPO earnings management and underwriter

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... ation and that there is a positive relation between underwriter reputation and firm operating performance. In addition, underwriters continue providing monitoring to the firms they take public. Using a sample of IPOs, we obtain results supporting our hypotheses. A weighted least squares regression confirms the robustness of our results. In the second essay, we address two questions: (1) whether post-IPO institutional ownership is affected by pre-IPO earnings management; and (2) whether the presence of institutional ownership has an impact on stock return. We find that institutional investors are not likely to be deceived or misled by pre-IPO earnings management. Institutional investors seem to be able to identify IPO firms of higher quality and always seek IPO firms with lower discretionary accruals depending on post-IPO information, but the presence of institutional ownership itself has little impact on stock returns.