Justice and Contracts as Double‐Edged Swords: Collaborative Product Innovation in Hub‐and‐Spoke Supply Chain Networks

Gordon Liu, Yantai Chen and Wai Wai Ko

Journal of Supply Chain Management, 2025, vol. 61, issue 2, 13-32

Abstract: This study explores how inter‐organizational justice, and formal contracts influence new product development (NPD) collaboration in supply chain networks. Challenging traditional transaction cost economics (TCE), the research focuses on collaborative NPD in hub‐and‐spoke supply chain structures. Data from 183 Chinese suppliers and 22 executive interviews reveal unexpected patterns in NPD collaboration. Procedural justice exhibits an inverted U‐shaped relationship with NPD collaboration, linking higher fairness to improved collaboration up to a point, beyond which further increases may associate with diminishing returns. In contrast, distributive justice shows a U‐shaped relationship with NPD collaboration, where higher equity initially relates to reduced collaboration but later correlates with renewed engagement. Notably, formal contracts amplify the negative interactions between these justice dimensions. This contradicts the conventional view of their complementary roles. These findings contribute to theoretical advancements by illustrating how inter‐organizational justice mechanisms function differently in complex network structures compared to simple dyadic relationships. Careful calibration of inter‐organizational justice dimensions and formal contracts proves essential for fostering productive NPD collaboration. These governance insights offer directions for enhancing supply chain relationship management.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1111/jscm.12340

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:jscmgt:v:61:y:2025:i:2:p:13-32

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1523-2409

Access Statistics for this article

Journal of Supply Chain Management is currently edited by Lisa Ellram, Craig Carter and Chad Autry

More articles in Journal of Supply Chain Management from Institute for Supply Management
Bibliographic data for series maintained by Wiley Content Delivery ().