Iranians have become so cynical about their national "tradition" of corruption that only public executions for the guilty seem likely to persuade them at Shah Mohammad Reza Pahlavi is serious about his promised crackdown on wrongdoers.

Fighting for his political life at the price of sacrificing some of those who were once his closest associates, the shah has yet to pass the Iitmus test of actually having those presumed guilty treid, much less punished.

Indeed, public skepticism is so great here that many Iranians automatically assume former prime minister Amir Abbas Hoveyda and former secret police chief Nematollah Nassiri, are actually in protective custody as a guard against mob justice.

Flushed by billions of dollars from oil revenues and other development projects, corruption has become so universal, ordinary Iranians complain, that the corner grocer jacks up prices, off government inspectors had passes the added costs on to the customers.

A foreign banker said the growing blatancy of corruption was on a mammoth scale. "In one deal I know of," he said, "eight people received bribes involving sums which I would not make for several years."

As a result corruption has become the target for the torrent of demonstrations against the shah. As an indication of the growing public pressure, two investigative bodies were set up during the past 10 days. They bring the total to at least four separate agencies that have been established to delve into alleged wrongdoing by civil servants, wheelers and dealers, the royal family and the Pahlavi Foundation, an investment fund which controls a portion of the shah's riches for the benefit of the poor.

Notably absent from Iran during the recent turmoil and subsequent investigations are such key figures as practically the entire royal family, except for the shah and his wife and their children, oil boss Hushang Ansary and dozens of inner circle businessmen and associates accused of financial irregularities.

Public cynicism is based on the deeply embedded notion that the shah has used corruption as a system of government to buy loyalty and that the Pahlavi Foundation long has served as a tax-free slush fund for the royal family rather than for charity as it is advertised.

Former prime minister Ali Amini, who counseled the shah to move forcefully against corruption, has argued that "no one believes him anymore - we must make people believe by cracking down hard."

Yet, so many of the heads the public is demanding have links straight to the shah that Iranians wonder whether he can afford to let his former friends defend themselves in a public court.

Mindful that the shah often has promised punishment of the corrupt during his 27-year reign, a long time foreign resident remarked. "This time the old whitewash won't work."

"Sacrificial lambs are needed - and fast - before it's too late," he added. "The only way to avoid embarrassment is to try them behind closed doors in the morning, then shoot them in public in the afternoon. Dead men, after all, tell no tales."

Soon after appointing the military government two weeks ago, the shah pledged in a television address "not to repeat the past mistakes and illegalities, the cruelty and corruption."

That unprecedented admission was aimed at disarming Iranians' anger at the dissipation of its oil income bomaza and its legacy of high rents, impossible Tehran trafic, torture and fear which are lumped together in peoples' minds as corruption, both moral and material.

Now that perhaps 18 former ministers and perhaps the same number of civil servants and businessmen are in custody, the government must find a way to formulate charges against them without implicating the shah.

Consider the problem involved with Hoveyda, the shah's affable prime mimister from 1965 to 1977 who, generally thought to have filled his own pockets.

Hoveyda instead symbolizes the extravagences of a regime considered mired in corruption and mismanagement which wasted tens and tens of billions of dollars in its headlong rush to meet the shah's promise of making Iran the world fifth economic power by the year 2000.

Moreover, public doubts about the zeal of outgoing Prime Minister Jaafar Sharif-Emami were based on his longtime duties as custodian of the Pahlavi Foundation, once described as "the most powerful economic force in the country" after the government itself.

The shah has never published a complete list of its tax-free operations. But some of the foundation's assets included hotels, text book publishers, cement factories, sugar mills, the biggest Iranian insurance company, one totally owned bank and perhaps 15 per cent of all commercial banking. Fifth Avenue property in New York, the First National Wisconsin Bank in Milwaukee and casinos (since closed down to appease the religious opposition).

A witness in a London court case involving defense contract corruption testified last year that Sir Shapoor Reporter, a favorite Iranian intermediary, "told me that the shah set up teh Pahlavi fund to receive bribes which otherwise would have found their way to officials."

During the summer the shah realized public fury at his relatives' legendary wheeling and dealing had reached dangerous proportions and announced a royal family code of conduct.

It barred family members from taking part inbusiness or using their influence in commercial deals, barred them from representing foreign firms or going into partnership with them.

During the brief period of unfettered Iranian press coverage this fall, Iranians were finally provided with details of major alleged corruption cases.

None made better reading than the Kish Island Development Corp. scandal, which seemed to epitomize the system's final extravagance.

The $100 million project, reportedly funded by Pahlavi Foundation money and the secret police force SAVAK, is purported to be a Persian Gulf winter resort for wealthy Arab oil sheikhs.

But since Arabs and Iranians do not mix socially with ease, Kish's pleasures, such as Concorde charter flights bringing in Paris call girls, gambling casinos manned by British croupiers, French restaurants, a golf course, and tax free boutiques, were allegedly all for Tehran jet set.

But the full charges of massive embezzlement, illegal sale fo three Kish Island Development Corp. planes and the pocketing of casino receipts only came to light before an examining magistrate after managing director Mahmoud Monsef was alleged to have bribed a pilot and had himself flown to the safety of Bahrain across the gulf.

Fellow Kish Island executive Mahmoud Qorbani brought the charges, claiming Monsef's wife ran a lucrative consulting firm handling the resort's main contracts while their children ran various boutiques and other enter.

Other alleged scandals that have come to light recently in exhaustive press reports include:

Senator Ali Rezai's steel empire, which started out with a single scrapfed rolling mill but expanded allegedly with official help in providing raw materials either at near cost or through imposing a protective duty that was later passed onto customers. Rezai fled Iran by private plane.

Former Health Minister Shojaeddin Shaikholeslamzadeh, now in jail along with two aides, accused of signing fraudulent foreign contracts, opium peddling with seized drugs and pocketing millions of dollars ear-marked for hospital construction.

Gen. Hojjat Kashani, who also fled abroad, charged with misappropriating millions of dollars when in charge of the Asian games in 1974. Insiders said he fired the supervising engineer and put his student son in his place at a fee of $500,000. The general subsequently charged $5 apiece for hundreds of pigeons confiscated from private owners on grounds they were a hazard for low flying aircraft! The birds were later released at opening day ceremonies for the game.

So far the only person accused of wrongdoing to have paid the kind of price the public seems to be demanding was Gen. Ali Mohammed Khademi. A former president of Iran Air, the national airlines, he shot himself fatally only hours before he was to have been arrested on corruption charges last week.