Abstract: As the behavioral agent of a listed company, senior management has an inescapable responsibility for corporate fraud. Based on the Upper Echelons Theory and the Behavioral Consistency Theory, this paper explores whether the behavioral inertia of a senior executive who used to work in a company that committed fraud would bring adverse effect to the accounting information quality of the company that he or she newly joins. Based on a tracking survey of job-hopping executives' whereabouts from 2000 to 2017 in China, we find that in terms of fraud occurrence, there is a significant positive correlation between the two companies that an executive works formally and now in. A long interval between an executive leaving the former company and his or her joining the current company and better corporate governance can effectively restrain the influence of management's behavioral inertia on corporate fraud. Further tests show that the above results are applicable mainly to the situation where the former company's fraud is not detected before the executive takes office in the current company. Our conclusion provides a new perspective for regulators and investors to understand the mechanism of how Chinese listed companies' accounting information quality is affected, and also provides empirical evidence that listed companies can use for reference in selecting executive candidates.

Key words: executives' job-hopping, behavioral inertia, corporate fraud, executive labor market