Dependence Structure, Trust Dimensions, and Governance Choices in Asian Marketing Channels: Evidence in China
Lucy Sojung Lee
Department of Management, SNU Business School, Seoul National University, Seoul
Guanghua School of Management, Peking University, China
Department of Organization and Strategy, Guanghua School of Management, Peking University, China
Building on three decades’ worth of theoretical work on firm dependence structure and firm governance strategy, from a dyadic perspective we investigate the mediating effects of different facets of interorganizational trust (competence trust and benevolence trust) on firm governance choices. We posit that firm dependence may evoke different facets of trust, which in turn lead to the firm’s choice of different governance mechanisms (contractual bonds and relational exchange). Using Chinese supplier–buyer dyads and the novel actor–partner interdependence model, we find strong support for such intermediate effects of trust dimensions on the relationships between dependence structure and governance choices from both supplier and buyer data. Practical implications for Asian business are discussed, and directions for future research are suggested.
Keywords: Dependence; Competence Trust, Benevolence Trust, Contractual Bonds, Relational Exchange, Actor–Partner Interdependence Model