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On May 17, 2012, the social networking company Facebook Inc. fixes its initial public offering (IPO) price at $38.00 a share. Over the next couple of months, contrary to expectations raised by previous IPOs, the stock price crashes more than 50 per cent. Immediately, the question arises whether the issuer’s or the stock market’s pricing of the share are in line with the firm’s fundamentals. Thus, the purpose of this paper is to determine the company value in close proximity to the date of IPO.
Social networking sites (SNSs) are central to social interaction and information sharing in the digital age. However, consuming social information on SNSs invites social upward comparisons with highly socially desirable profile representations, which easily elicits envy in users and leads to unfavorable behaviors on SNSs. This in turn can erode the subjective well-being of users and the sustainability of the SNS platform. Therefore, this paper seeks to develop a better theoretical understanding of how users respond to envy on SNSs. We review literature on envy in offline interactions to derive three behavioral strategies to reduce envy, which we then transfer to the SNS context (self-enhancement, gossiping, and discontinuous intention). Further, we propose a research model and examine how culture, specifically individualism-collectivism, affects the relationship between envy on an SNS and the three strategies. We empirically test the variance-based structural equation model through survey data collected of Facebook users from Germany and Hong Kong. Our findings provide first insights into the link between envy on SNSs, related behavioral strategies and the moderating role of individualism for self-enhancement.