Local Governors’ Turnover and Firms’ Investment Comovement
Zhang: Yin, Bingyu Guan: Bingyu

Abstract
Based on the empirical evidence of all A-share listed companies in China from 2007 to 2015, this paper examines the impact of the replacement of local municipal Party committee secretaries on corporate investment synergy. It is found that the replacement of local Party committee secretaries can significantly increase the investment synergy of enterprises in the same year, which can explain that the impact of the replacement of municipal Party committee secretaries on enterprises is more reflected in the transfer of legal political power. This paper further examines the impact of macro environment and official characteristics on the replacement of municipal Party Secretary and investment synergy. The results show that economic depression enhances the impact of official turnover on investment congruence; the impact of official turnover on investment congruence is significantly reduced in areas with high economic development level and high marketization; when the successor municipal Party secretary is from a professional background of economic management or from a different place, the impact of official turnover on investment congruence is significantly reduced; when the former municipal Party Secretary's whereabouts In the case of abnormal promotion, the influence of official turnover on investment synergy is stronger.

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