Mutual and Exclusive: Dyadic Sources of Trust in Interorganizational Exchange
Organization Science Volume: 28, Number: 1 (January-February 2017): 74-92.
40 Pages Posted: 23 Nov 2016 Last revised: 14 Apr 2017
Date Written: November 21, 2016
Trust in interfirm exchange has traditionally been treated as mutually held and jointly determined by the two parties in a relationship. Yet, the expectations of exchange partners can, and routinely do, differ with respect to the goals, preferences, and vulnerabilities in their shared relationship. To account for such differences in expectations we propose a broadened conceptualization of the sources of interorganizational trust as dyadic. Viewing the sources of trust as dyadic expands the conventional focus on mutual elements to further emphasize exclusive features of an exchange relationship. To substantiate our theory, we examine a key source of interorganizational trust, exchange hazards, and assess the extent to which its effects vary as a function of: (1) the locus of exchange hazards (own vs. other) in the dyad, (2) the degree of power imbalance in the dyad, and (3) each party’s power position in the dyad. To assess the validity of our claims we devise a matched dyad research design and collect identical information from both buyers and suppliers in a given exchange relationship. Based on our results, we make three unique observations consistent with the notion of dyadic sources of trust. First, the same exchange hazards have contrasting effects on trust (enhancing versus diminishing) across the dyad. Second, the degree of power imbalance has opposing effects across the dyad. Third, the relative significance of partners’ exchange hazards varies based on their respective power positions.
Keywords: Trust, Dyad, Power, Interorganizational
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