A Study On Senior Political Background, Excessive Government Intervention And Corporate Investment Behavior

2008financial crisis sweeping the globe, China’s economy has thus been affected.The government subsequently introduced a series of economic stimulus, a short timestimulating economic growth, but in subsequent years, the negative impact on theeconomy starting to show. And because of our economic system in transition, with theWestern developed markets of different economic characteristics, the over-investment inthe study of the behavior of the enterprise, not only to take into account market factors,but also the institutional factors, political factors into consideration. Therefore, this paperbased on our special situation, the senior political background, excessive governmentintervention and corporate investment behavior combine in order to study the intrinsicrelationship between the three.In this paper,2008-2012Shanghai and Shenzhen778non-financial listed companiesfor the study, research executives and political background of excessive governmentintervention on investment. The results showed that, regardless of the state-ownedenterprises or private enterprises, executives and political backgrounds can be to curbexcessive investment behavior of enterprises, state-owned enterprise executives andpolitical background to better suppress the occurrence of excessive investment in itsbehavior. The major government intervention to play " grabbing hand " role. Meanwhile,further research showed that the state-owned enterprise executives and politicalbackground of the government to protect businesses from looting, and private enterpriseexecutives and political context can not protect corporate plunder of property rights fromgovernment.These conclusions suggest that a reasonable and effective executives and politicalcontext can provide protection for the healthy development of enterprises; governmentshould establish the concept of separating and accelerating the market process, reducingthe government’s "excessive" intervention, inappropriate government intervention to weaken the motivation real finite effective government, in order to achieve a healthy andorderly development of the economy; same time, enterprises should also continue toimprove its governance structure, establish a sound corporate overinvestment controlmechanism.