The shadows of politicians with prior CEO experience: Evidence from corporate investment efficiency in China
研究发现中国约七分之一的地方官员有CEO经历，他们主政的城市企业投资效率更低，但GDP增长更快，官员也更容易晋升，企业虽获得更多补贴和贷款，长期财务表现却恶化。
One in seven Chinese politicians has prior CEO experience, governing jurisdictions that account for about thirty percent of listed firms. This study investigates the impact of municipal politicians with prior CEO experience (PCEs) on corporate investment decisions. We find that the presence of PCEs is associated with lower corporate investment efficiency. This inefficiency is particularly pronounced when PCEs have longer prior CEO tenures, come from larger firms or industries with a stronger local presence, originate from private firms, or face stronger promotion incentives and greater political power. Additional analyses indicate that PCE-led cities exhibit higher GDP growth, and PCEs are more likely to be promoted than their counterparts without CEO experience. While firms in PCE-led cities benefit from increased financial support, such as government subsidies and loans, their long-term financial performance deteriorates. Collectively, this study provides systematic evidence that local officials strategically leverage their professional expertise to stimulate economic growth, but at the cost of corporate investment efficiency.