Distributive Justice and Joint Venture Termination: A Social Exchange Perspective

35 Pages Posted: 18 Feb 2016 Last revised: 14 Mar 2016

See all articles by Birgul Arslan

Birgul Arslan

Koc University

Ulrich Wassmer

EMLYON Business School

Pierre Dussauge

HEC Paris - Strategy & Business Policy

Date Written: October 1, 2015

Abstract

What role does distributive injustice play in joint venture (JV) termination? We define distributive injustice as a deviation from the contractual allocation of JV-related benefits caused by private benefits. Drawing on social exchange theory, we argue that perceptions of distributive injustice severely damage relationship quality and lead to eventual JV termination. We also suggest that, while both economic and justice considerations influence joint venture termination, they have different implications for JV termination mode. Based on a sample of 284 joint ventures formed between 1996 and 2010, we find evidence that distributive injustice increases the likelihood of JV termination in general, and the likelihood of acquisition of the JV by one of the partners, in particular.

Keywords: Joint ventures, joint venture termination, distributive justice, social exchange theory, private benefits

Suggested Citation

Arslan, Birgul and Wassmer, Ulrich and Dussauge, Pierre, Distributive Justice and Joint Venture Termination: A Social Exchange Perspective (October 1, 2015). HEC Paris Research Paper No. SPE-2016-1139. Available at SSRN: https://ssrn.com/abstract=2733206 or http://dx.doi.org/10.2139/ssrn.2733206

Birgul Arslan (Contact Author)

Koc University ( email )

Rumelifeneri Yolu
34450 Sar?yer
Istanbul, 34450
Turkey
2123381899 (Phone)

Ulrich Wassmer

EMLYON Business School ( email )

23 Avenue Guy de Collongue
Ecully, 69132
France

Pierre Dussauge

HEC Paris - Strategy & Business Policy ( email )

Jouy-en-Josas Cedex, 78351
France
01 39 67 72 79 (Phone)

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