Corruption and the Culture of Real Estate Development

Abstract

Corruption, greed, and boom-and-bust are major features of the historiography and reportage of the real estate development industry.1 Careful empirical study of land-use and building regulation indicates how opportunities and incentives for corruption depend on the struc ture of production in development.2 Still, we have no strong evidence which indicates that the real estate industry is actually much more corrupt than others (or other professions); and many of the revered members of the industry are known within the industry for their scrupulous ethical stance and behavior.3 I shall not be making any empirical claims in this paper. However, I want to suggest that there are some cultural features of real estate development which make it quite susceptible to corruption, whether that susceptibility is taken to mean that corruption is not easily stopped here, or it is encouraged, or perhaps it is even necessary if the activity is to be pursued at all. Moreover, we have here an interesting problem in moral explana tion, for corruption is usually taken as sinful and intrinsic and cultural, and as behavioral and situation-dependent. In explaining corruption, we may justify it either as part of the web of meaning and action (namely, culture), or as a response to opportunities and incentives.4 I will consider both explanations. Now, I will assume that we are all subject to pride, envy, greed, gluttony, sloth and other such vices. But some cultural structures and situations are more likely to excite those temptations than others. And as for justification, I think most of us will agree that having been presented with a great temptation does not justify our engaging in it?if we believe it is wrong?although we may find ourselves quite understanding of those corrupted at these moments.