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Corruption stereotype and the unintended consequences of an anti-corruption campaign: evidence from the real estate sector in China

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  • Fang, Hanming
  • Zhang, Rongjie

Abstract

In an anti-corruption campaign, government officials have strong incentives to avoid taking actions that may trigger disciplinary investigations. In China’s land sales market, we find that the fraction of residential land parcels purchased by State-Owned-Enterprises (SOE) developers significantly increased after the anti-corruption campaign compared to those purchased by private developers. This result is partly driven by the following mechanism: Because selling land to private developers carries a higher corruption stereotype, local officials, particularly the relatively “clean” ones, become more reluctant to sell land to private developers for the purpose of self-preservation. Thus China’s anti-corruption campaign may have unintentionally contributed to the resurgence of the SOEs. Local officials’ corruption stereotype avoidance in an anti-corruption campaign has broad implications.

Suggested Citation

  • Fang, Hanming & Zhang, Rongjie, 2025. "Corruption stereotype and the unintended consequences of an anti-corruption campaign: evidence from the real estate sector in China," Journal of Public Economics, Elsevier, vol. 249(C).
    • Handle: RePEc:eee:pubeco:v:249:y:2025:i:c:s0047272725001720
    DOI: 10.1016/j.jpubeco.2025.105474
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    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets

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