Trust formation in Korean new product alliances: How important are pre-existing social ties?

The focus of this study is on the nature and influence of social connections versus other relational mechanisms on trust formation in an emerging Asian economy. We examine the role of communication quality, perceived fairness, and pre-existing social relationships for the formation of trust in 47 ve...

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Bibliographic Details
Published in:Asia Pacific journal of management 2010-06, Vol.27 (2), p.299-319
Main Authors: Bstieler, Ludwig, Hemmert, Martin
Format: Article
Language:English
Subjects:
Alliances
Behavior
Business and Management
Collaboration
Communication
Cooperation
Korea
Management
Perceptions
Product development
R&D
Research & development
Social identity
Social ties
Studies
Trust
Trust formation
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Summary:The focus of this study is on the nature and influence of social connections versus other relational mechanisms on trust formation in an emerging Asian economy. We examine the role of communication quality, perceived fairness, and pre-existing social relationships for the formation of trust in 47 vertical new product development alliances in South Korea. The empirical results indicate a relatively minor importance of pre-existing social ties vis-à-vis communication quality and fairness for the development of trust. Contrary to widespread perceptions, pre-existing social ties do not appear to directly contribute to establishing trust with external alliance partners in Korea. Multiple explanations are offered for this unexpected finding. Instead, existing social relationships moderate the importance of fairness for trust formation. When conducting partnerships with Korean firms, managers should focus more on a quality communication and fair behavior when trust formation is the objective, than on social connections.
ISSN:0217-4561
1572-9958
DOI:10.1007/s10490-008-9124-1