The Research On The Relationship Among The Political Uncertainty,CEO Background Characteristics,and Corporate Overinvestment

China is a country that combines political centralization and economic decentralization.The local governments have great economic rights.Especially under the influence of Confucian culture,our country is also a “interpersonal relationship society”.Connections and relationships mean how much resources can be obtained,and the relationship between business and government is no exception.The state-enterprise alliance is normal.Out of the pressure of performance appraisal and the pursuit of political promotion,the municipal party committee secretary who is the leader of the local government has the power and motivation to intervene in the enterprise and affect the investment behavior of the enterprise.However,the replacement of the municipal party committee secretary will lead to political uncertainty.The sustainability of policy is poor,and the original relationship between government and enterprises is broken.The management risk of enterprises will increase,which will further affect the decision-making behavior of enterprises.The overinvestment of enterprises will damage the company's value and shareholders' interests,and seriously hinder the operation and development of the enterprise.We selected Shenzhen A-share 7926 listed companies from 2010 to 2016 as the research samples in this paper.Based on the background characteristics of the CEO who is the “backbone” of the company's management,the paper empirically examines the impact of the CEO's financial background,political experience,bank background and part-time position on the excessive investment of the company.Furthermore,divided the property rights ofenterprises into group research.In addition,based on the special “decentralized authority” institutional background,in the perspective of the political uncertainty brought by the change of the municipal party committee secretary,we empirically test the moderating effect of the municipal party committee secretary replacement on CEO background characteristics and overinvestment in enterprises.The study found that CEO with financial background is more likely to reduce the level of overinvestment in the company,which is more pronounced in non-state enterprises.CEOs with political experience are more likely to lead to excessive investment in businesses,which is more pronounced in state-owned enterprises.At the same time,the political uncertainty brought by the change of party secretary will affect the relationship between CEO characteristics and overinvestment in enterprises.This paper enriches the research on the influencing factors of enterprise overinvestment,and helps enterprises to understand their own investment activities correctly to improve their investment efficiency.It is helpful for enterprises to regulate and supervise the investment behavior of CEO with different background characteristics in order to ensure the maximization of shareholders' interests.At the same time,it verifies that the political uncertainty caused by the change of officials has a certain influence on the investment behavior of enterprises in the jurisdiction.