Skip to main content

Advertisement

SpringerLink
Log in

Investigating the Underlying Factors of Corruption in the Public Construction Sector: Evidence from China

  • Original Paper
  • Published:
Science and Engineering Ethics Aims and scope Submit manuscript

Abstract

Over recent years, the issue of corruption in the public construction sector has attracted increasing attention from both practitioners and researchers worldwide. However, limited efforts are available for investigating the underlying factors of corruption in this sector. Thus, this study attempted to bridge this knowledge gap by exploring the underlying factors of corruption in the public construction sector of China. To achieve this goal, a total of 14 structured interviews were first carried out, and a questionnaire survey was then administered to 188 professionals in China. Two iterations of multivariate analysis approaches, namely, stepwise multiple regression analysis and partial least squares structural equation modeling were successively utilized to analyze the collected data. In addition, a case study was also conducted to triangulate the findings obtained from the statistical analysis. The results generated from these three research methods achieve the same conclusion: the most influential underlying factor leading to corruption was immorality, followed by opacity, unfairness, procedural violation, and contractual violation. This study has contributed to the body of knowledge by exploring the properties of corruption in the public construction sector. The findings from this study are also valuable to the construction authorities as they can assist in developing more effective anti-corruption strategies.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1
Fig. 2

Similar content being viewed by others

References

  • Alutu, O. E., & Udhawuve, M. L. (2009). Unethical practices in Nigerian engineering industries: Complications for project management. Journal of Management in Engineering, 25(1), 40–43.

    Article  Google Scholar 

  • Ameh, O. J., & Odusami, K. T. (2010). Professionals’ ambivalence toward ethics in the Nigerian construction industry. Journal of Professional Issues in Engineering Education and Practice, 136(1), 9–16.

    Article  Google Scholar 

  • ASCE. (2015). Policy statement 510—Combating corruption. http://www.asce.org/issues-and-advocacy/public-policy/policy-statement-510—combating-corruption/ Accessed 8 October 2015.

  • Badun, M. (2011). The relationship between political corruption and public investment—The case of Croatia. Drustvena Istrazivanja, 20(2), 295–316.

    Google Scholar 

  • Besio, C., & Pronzini, A. (2014). Morality, ethics, and values outside and inside organizations: An example of the discourse on climate change. Journal of Business Ethics, 119(3), 287–300.

    Article  Google Scholar 

  • Bologna, R., & Del Nord, R. (2000). Effects of the law reforming public works contracts on the Italian building process. Building Research and Information, 28(2), 109–118.

    Article  Google Scholar 

  • Bowen, P., Akintoye, A., Pearl, R., & Edwards, P. J. (2007a). Ethical behaviour in the South African construction industry. Construction Management and Economics, 25(6), 631–648.

    Article  Google Scholar 

  • Bowen, P. A., Edwards, P. J., & Cattell, K. (2012). Corruption in the South African construction industry: A thematic analysis of verbatim comments from survey participants. Construction Management and Economics, 30(10), 885–901.

    Article  Google Scholar 

  • Bowen, P., Edwards, P., & Cattell, K. (2015). Corruption in the South African construction industry: Experiences of clients and construction professionals. International Journal of Project Organization and Management, 7(1), 72–97.

    Article  Google Scholar 

  • Bowen, P., Pearl, R., & Akintoye, A. (2007b). Professional ethics in the South African construction industry. Building Research and Information, 35(2), 189–205.

    Article  Google Scholar 

  • Brown, J., & Loosemore, M. (2015). Behavioural factors influencing corrupt action in the Australian construction industry. Engineering, Construction and Architectural Management, 22(4), 372–389.

    Article  Google Scholar 

  • Chan, A. P. C., Ho, D. C. K., & Tam, C. M. (2001). Design and build project success factors: Multivariate analysis. Journal of Construction Engineering and Management, 127(2), 93–100.

    Article  Google Scholar 

  • Cheng, H. F., Gutierrez, M., Mahajan, A., Shachmurove, Y., & Shahrokhi, M. (2007). A future global economy to be built by BRICs. Global Finance Journal, 18(2), 143–156.

    Article  Google Scholar 

  • Choudhry, R., & Iqbal, K. (2013). Identification of risk management system in construction industry in Pakistan. Journal of Management in Engineering, 29(1), 42–49.

    Article  Google Scholar 

  • Conway, J. M., & Huffcutt, A. I. (2003). A review and evaluation of exploratory factor analysis practices in organizational research. Organizational Research Methods, 6(2), 147–168.

    Article  Google Scholar 

  • Crist, R. A. (2009). The ASCE committee of global principles for professional conduct. Leadership and Management in Engineering, 9(3), 144–146.

    Article  Google Scholar 

  • Crosthwaite, D. (1998). The internationalization of British construction companies 1990–96: An empirical analysis. Construction Management and Economics, 16(4), 389–395.

    Article  Google Scholar 

  • de Jong, M., Henry, W. P., & Stansbury, N. (2009). Eliminating corruption in our engineering/construction industry. Leadership and Management in Engineering, 9(3), 105–111.

    Article  Google Scholar 

  • Deng, X., Low, S. P., Li, Q., & Zhao, X. (2014a). Developing competitive advantages in political risk management for international construction enterprises. Journal of Construction Engineering and Management, 140(9), 04014040.

    Article  Google Scholar 

  • Deng, X., Low, S. P., & Zhao, X. (2014b). Project system vulnerability to political risks in international construction projects: The case of Chinese contractors. Project Management Journal, 45(2), 20–33.

    Article  Google Scholar 

  • Deng, X., Tian, Q., Ding, S., & Boase, B. (2003). Transparency in the procurement of public works. Public Money and Management, 23(3), 155–162.

    Article  Google Scholar 

  • Dziuban, C. D., & Shirkey, E. C. (1974). When is a correlation matrix appropriate for factor analysis? Some decision rules. Psychological Bulletin, 81(6), 358.

    Article  Google Scholar 

  • Fitch, G., Odeh, I., & William Ibbs, C. (2015). Economic sustainability of DBO water based on wastewater projects in the U.S.: Three case studies. Journal of Construction Engineering and Management, 141(5), 05015001.

    Article  Google Scholar 

  • Frankel, M. S. (1989). Professional codes: Why, how, and with what impact? Journal of Business Ethics, 8(2/3), 109–115.

    Article  Google Scholar 

  • Gefen, D., Straub, D., & Boudreau, M. (2000). Structural equation modeling and regression: Guidelines for research practice. Communications of the Association for Information Systems, 4(1), 7.

    Google Scholar 

  • Gray, C. W., & Kaufman, D. (1998). Corruption and development. Financial Development, 35(1), 7–10.

    Google Scholar 

  • Gunduz, M., & Önder, O. (2013). Corruption and internal fraud in the Turkish construction industry. Science and Engineering Ethics, 19(2), 505–528.

    Article  Google Scholar 

  • Hair, J. F., Black, W. C., Babin, B. J., Anderson, R. E., & Tatham, R. L. (2010). Multivariate data analysis. Upper Saddle River, NJ: Prentice Hall.

    Google Scholar 

  • Hair, J. F., Ringle, C. M., & Sarstedt, M. (2011). PLS-SEM: Indeed a silver bullet. Journal of Marketing Theory and Practice, 19(2), 139–151.

    Article  Google Scholar 

  • Hebei News. (2013). Nine cases in Beijing that privately change the scope of scientific-purposed land will be investigated. http://house.hebnews.cn/2013-07/04/content_3335604.htm. Accessed May 11, 2014.

  • Hultsch, D. F., MacDonald, S. W., Hunter, M. A., Maitland, S. B., & Dixon, R. A. (2002). Sampling and generalisability in developmental research: Comparison of random and convenience samples of older adults. International Journal of Behavioral Development, 26(4), 345–359.

    Article  Google Scholar 

  • Hwang, B. G., Zhao, X., & Yu, G. S. (2016). Risk identification and allocation in underground rail construction joint ventures: Contractors’ perspective. Journal of Civil Engineering and Management, 22(6), 758–767.

    Article  Google Scholar 

  • Jain, A. K. (2001). Corruption: A review. Journal of Economic Surveys, 15(1), 71–121.

    Article  Google Scholar 

  • Jessen, R. J. (1969). Some methods of probability non-replacement sampling. Journal of the American Statistical Association, 64(325), 175–193.

    Article  Google Scholar 

  • Jiang, W., & Feng, D. (2007). Research on the problems in commonly-used methods of construction project bid evaluation. Construction Economy, S1, 276–278.

    Google Scholar 

  • Jimenez, F. (2009). Building boom and political corruption in Spain. South European Society and Politics, 14(3), 255–272.

    Article  Google Scholar 

  • Kenny, C. (2009). Transport construction, corruption and developing countries. Transport Reviews, 29(1), 21–41.

    Article  Google Scholar 

  • Kenny, C. (2012). Publishing construction contracts to improve efficiency and governance. Proceedings of the Institution of Civil Engineers, 165(5), 18–22.

    Google Scholar 

  • Lam, E. W., Chan, A. P., & Chan, D. W. (2008). Determinants of successful design-build projects. Journal of Construction Engineering and Management, 134(5), 333–341.

    Article  Google Scholar 

  • Lan, P. (1999). Management in the Chinese construction industry. Asia Pacific Business Review, 5(3–4), 94–118.

    Article  Google Scholar 

  • Le, Y., Shan, M., Chan, A. P. C., & Hu, Y. (2014a). Overview of corruption research in construction. Journal of Management in Engineering, 30(4), 02514001.

    Article  Google Scholar 

  • Le, Y., Shan, M., Chan, A. P. C., & Hu, Y. (2014b). Investigating the causal relationships between causes of and vulnerabilities to corruption in the Chinese public construction sector. Journal of Construction Engineering and Management, 140(9), 05014007.

    Article  Google Scholar 

  • Letki, N. (2006). Investigating the roots of civic morality: Trust, social capital, and institutional performance. Political Behavior, 28(4), 305–325.

    Article  Google Scholar 

  • Ling, F. Y. Y., & Hoang, V. T. P. (2010). Political, economic, and legal risks faced in international projects: Case study of Vietnam. Journal of Professional Issues in Engineering Education and Practice, 136(3), 156–164.

    Article  Google Scholar 

  • Liu, J., Zhao, X., & Yan, P. (2016). Risk paths in international construction projects: Case study from Chinese contractors. Journal of Construction Engineering and Management, 142(6), 05016002.

    Article  Google Scholar 

  • Meduri, S., & Annamalai, T. (2013). Unit costs of public and PPP road projects: Evidence from India. Journal of Construction Engineering and Management, 139(1), 35–43.

    Article  Google Scholar 

  • Moodley, K., Smith, N., & Preece, C. N. (2008). Stakeholder matrix for ethical relationships in the construction industry. Construction Management and Economics, 26(6), 625–632.

    Article  Google Scholar 

  • Nag, B. (2015). Combating corruption in Indian public procurement–Some exploratory case Studies. Journal of Institute of Public Enterprise, 38(1/2), 1–34.

    Google Scholar 

  • National Bureau of Statistics of China. (2015). China statistical yearbook. Beijing: China Statistics Press. http://www.stats.gov.cn/tjsj/ndsj/2015/indexeh.htm. Accessed September 24, 2016.

  • Ning, Y., & Ling, F. Y. Y. (2013). Reducing hindrances to adoption of relational behaviors in public construction projects. Journal of Construction Engineering and Management, 139(11), 04013017.

    Article  Google Scholar 

  • Norušis, M. J. (2008). SPSS 16.0 advanced statistical procedures companion. Upper Saddle River, NJ: Prentice Hall Higher Education.

    Google Scholar 

  • Noy, C. (2008). Sampling knowledge: The hermeneutics of snowball sampling in qualitative research. International Journal of Social Research Methodology, 11(4), 327–344.

    Article  Google Scholar 

  • Romero, J., Jimenez, F., & Villoria, M. (2012). (Un) sustainable territories: Causes of the speculative bubble in Spain (1996–2010) and its territorial, environmental, and sociopolitical consequences. Environment and Planning C: Government and Policy, 30(3), 467–486.

    Article  Google Scholar 

  • Russell, M., Liu, M., Howell, G., & Hsiang, S. (2014). Case studies of the allocation and reduction of time buffer through use of the last planner system. Journal of Construction Engineering and Management, 141(2), 04014068.

    Article  Google Scholar 

  • Shan, M., Chan, A. P. C., Le, Y., & Hu, Y. (2015a). Investigating the effectiveness of response strategies for vulnerabilities to corruption in the Chinese public construction sector. Science and Engineering Ethics, 21(3), 683–705.

    Article  Google Scholar 

  • Shan, M., Chan, A., Le, Y., Hu, Y., & Xia, B. (2016). Understanding collusive practices in chinese construction projects. Journal of Professional Issues in Engineering Education and Practice, 05016012. doi:10.1061/(ASCE)EI.1943-5541.0000314.

  • Shan, M., Chan, A. P. C., Le, Y., Xia, B., & Hu, Y. (2015b). Measuring corruption in public construction projects in China. Journal of Professional Issues in Engineering Education and Practice, 141(4), 05015001.

    Article  Google Scholar 

  • Sichombo, B., Muya, M., Shakantu, W., & Kaliba, C. (2009). The need for technical auditing in the Zambian construction industry. International Journal of Project Management, 27(8), 821–832.

    Article  Google Scholar 

  • Skorupka, D. (2008). Identification and initial risk assessment of construction projects in Poland. Journal of Management in Engineering, 24(3), 120–127.

    Article  Google Scholar 

  • Snaith, M. S., & Khan, M. U. (2008). Deleterious effects of corruption in the roads sector. Proceedings of the Institution of Civil Engineers-Transport, 161(4), 231–235.

    Article  Google Scholar 

  • Sohail, M., & Cavill, S. (2008). Accountability to prevent corruption in construction projects. Journal of Construction Engineering and Management, 134(9), 729–738.

    Article  Google Scholar 

  • Tabish, S., & Jha, K. N. (2011). Analyses and evaluation of irregularities in public procurement in India. Construction Management and Economics, 29(3), 261–274.

    Article  Google Scholar 

  • Tabish, S., & Jha, K. N. (2012). The impact of anti-corruption strategies on corruption free performance in public construction projects. Construction Management and Economics, 30(1), 21–35.

    Article  Google Scholar 

  • Tang, L. C. M., Atkinson, B., & Zou, R. R. (2012). An entropy-based SWOT evaluation process of critical success factors for international market entry: A case study of a medium-sized consulting company. Construction Management and Economics, 30(10), 821–834.

    Article  Google Scholar 

  • Tanzi, V. (1998). Corruption around the world: Causes, consequences, scope, and cures. IMF Staff Papers, 45(4), 559–594.

    Article  Google Scholar 

  • Transparency International. (2008). Bribe payers index 2008. Berlin: Transparency International.

    Google Scholar 

  • Transparency International. (2011). Bribe payers index 2011. Berlin: Transparency International.

    Google Scholar 

  • Transparency International. (2013). Preventing corruption on construction projects. http://archive.transparency.org/tools/contracting/construction_projects. Accessed January 16, 2013.

  • Vee, C., & Skitmore, C. (2003). Professional ethics in the construction industry. Engineering, Construction and Architectural Management, 10(2), 117–127.

    Article  Google Scholar 

  • Wang, H. (2014). A total of 164 provincial officials have been prosecuted over the past 28 years. http://dzb.fawan.com/html/2014-06/11/content_495373.htm. Accessed September 24, 2016.

  • World Economic Forum. (2013). Partnering against corruption initiative. http://www.weforum.org/issues/partnering-against-corruption-initiative. Accessed January 16, 2013.

  • Wu, Y., Huang, Y., Zhang, S., & Zhang, Y. (2012). Quality self-control and co-supervision mechanism of construction agent in public investment project in China. Habitat International, 36(4), 471–480.

    Article  Google Scholar 

  • Xinhua Net. (2010). Investigation team of the State Council: Illegal subcontracting existed in the residential building catching fire in Shanghai. http://news.ifeng.com/mainland/special/shanghaidalouzhuohuo/content-2/detail_2010_11/17/3142836_0.shtml. Accessed November 20, 2015.

  • Xinhua Net. (2011a). More efforts will be imposed on the investigation of corruption in public construction sector in China. http://news.xinhuanet.com/legal/2011-05/17/c_121426891.htm. Accessed September 24, 2016.

  • Xinhua Net. (2011b). Jiangsu: Maoye Plaza project of Huaian city starts building without a construction approval when it is still under the planning announcement phase. http://csj.xinhuanet.com/2011-08/21/c_131063745_2.htm. Accessed May 11, 2014.

  • Xinhua Net. (2014). Irregularities in biddings of three gorges project: Nepotism, and waste of public money. http://news.xinhuanet.com/finance/2014-02/19/c_126159860.htm. Accessed May 9, 2014.

  • Ye, K., Li, B., & Shen, L. (2013). Key factors considered in compiling tender prices for China’s public works projects. Journal of Management in Engineering, 29(3), 206–215.

    Article  Google Scholar 

  • Zarkada-Fraser, A., & Skitmore, M. (2000). Decisions with moral content: Collusion. Construction Management and Economics, 18(1), 101–111.

    Article  Google Scholar 

  • Zeng, C., Zhang, A., & Xu, S. (2016). Urbanization and administrative restructuring: A case study on the Wuhan urban agglomeration. Habitat International, 55, 46–57.

    Article  Google Scholar 

  • Zhao, X., Hwang, B., & Low, S. P. (2013). Critical success factors for enterprise risk management in Chinese construction companies. Construction Management and Economics, 31(12), 1199–1214.

    Article  Google Scholar 

  • Zhao, X., Hwang, B. G., Low, S. P., & Wu, P. (2015). Reducing hindrances to enterprise risk management implementation in construction firms. Journal of Construction Engineering and Management, 141(3), 04014083.

    Article  Google Scholar 

  • Zhao, X., & Singhaputtangkul, N. (2016). Effects of firm characteristics on enterprise risk management: Case study of Chinese construction firms operating in Singapore. Journal of Management in Engineering, 32(4), 05016008.

    Article  Google Scholar 

  • Zou, P. X. (2006). Strategies for minimizing corruption in the construction industry in China. Journal of Construction in Developing Countries, 11(2), 15–29.

    Google Scholar 

Download references

Acknowledgements

This work has been supported by the National Natural Science Foundation of China (Grant Nos. 71172107 and 71390523), Tongji University Ph.D. Short-term Abroad Academic Visiting Scholarship (Grant No. 201502014). Dr. K. N. Jha and Dr. S. Z. S. Tabish at Indian Institute of Technology, Delhi are acknowledged for permitting the use of their questionnaire instrument.

Author information

Authors and Affiliations

  1. Department of Building, National University of Singapore, 4 Architecture Drive, Singapore, 117566, Singapore

    Ming Shan

  2. Research Institute of Complex Engineering and Management, School of Economics and Management, Tongji University, Tongji Building A, 1500 Siping Road, Shanghai, 200092, China

    Yun Le & Yi Hu

  3. Department of Civil and Environmental Engineering, The University of Auckland, Room 1108, Level 11, Bldg 401, 20 Symonds Street, Auckland, 1010, New Zealand

    Kenneth T. W. Yiu

  4. Department of Building and Real Estate, The Hong Kong Polytechnic University, Hung Hom, Kowloon, Hong Kong, China

    Albert P. C. Chan

Authors
  1. Ming Shan
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Yun Le
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Kenneth T. W. Yiu
    View author publications

    You can also search for this author in PubMed Google Scholar

  4. Albert P. C. Chan
    View author publications

    You can also search for this author in PubMed Google Scholar

  5. Yi Hu
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Ming Shan.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Shan, M., Le, Y., Yiu, K.T.W. et al. Investigating the Underlying Factors of Corruption in the Public Construction Sector: Evidence from China. Sci Eng Ethics 23, 1643–1666 (2017). https://doi.org/10.1007/s11948-016-9865-z

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11948-016-9865-z

Keywords

Search

Navigation