THE ETHICS IN THE BUSINESS OF ROMANIAN REAL ESTATE AGENTS

Basarab Gogoneata ()
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Basarab Gogoneata: Academy of Economic Studies, Bucharest

The AMFITEATRU ECONOMIC journal, 2008, vol. 10, issue 23, 181-186

Abstract: The paper presents an analysis of the main ethical aspects concerning the Romanian real estate intermediation sector. The analysis tries to evaluate the true utility of real estate agents’ services and to assess the potential negative effects of an unethical behavior for the clients. In Romanian real estate market, there are at least three issues that endanger the business ethics of intermediaries. First, as the prices increase very fast, the transactions involve larger and larger amounts of money that attract entrepreneurs with weak intrinsic ethical standards. Very often, they fail to understand the instrumental value of business ethics too. Thus, instead of building a reputation in the market they prefer an immediate gain. Secondly, the real estate brokerage is poorly regulated in Romania. According to the motto “if not forbidden, it's permitted”, the real estate agents adopted very lax ethical standards. The third factor is the deficit of public information regarding the real estate market and the activity of real estate agents. The press usually reproduces the views of leading real estate agents, instead of providing authentic investigations of their services. The main conclusion is that there is evidence that the Romanian real estate agents try to maximize their profits by manipulating the economic environment rather than providing valuable services for their clients.

Keywords: business ethics; real estate agent; rent-seeking; reservation price; moral hazard (search for similar items in EconPapers)
JEL-codes: D21 D82 L85 (search for similar items in EconPapers)
Date: 2008
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Persistent link: https://EconPapers.repec.org/RePEc:aes:amfeco:v:10:y:2008:i:23:p:181-186

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