Trust formation in Korean new product alliances: How important are pre-existing social ties?
Abstract
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.
Department
Marketing
Publication Date
6-1-2010
Journal Title
Asia Pacific Journal of Management
Publisher
Springer
Digital Object Identifier (DOI)
Document Type
Article
Recommended Citation
Bstieler, L. and Hemmert, M. (2010). Trust formation in Korean new product alliances: How important are pre-existing social ties? Asia Pacific Journal of Management, 27, 2, 299-319.