Trust and collaboration in the aftermath of conflict: the effects of contract structure

Deepak Malhotra and Fabrice Lumineau

MPRA Paper from University Library of Munich, Germany

Abstract: Leveraging a longitudinal dataset concerning 102 inter-firm disputes, we evaluate the effects of contract structure on trust and on the likelihood of continued collaboration. We theoretically refine and empirically extend prior research by (a) distinguishing between control and coordination functions of contracts, (b) separating goodwill-based and competence-based trust, and (c) evaluating the effects of contract structure on relational outcomes in the context of disputes. We find that control provisions increase competence-based trust, but reduce goodwill-based trust, resulting in a net decrease in the likelihood of continued collaboration. Coordination provisions increase competence-based trust, leading to an increased likelihood of continued collaboration.

Keywords: Trust; Contract; Conflict (search for similar items in EconPapers)
JEL-codes: K41 L14 M10 (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (75)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:38358

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