Handbook Of Trust Research, Fourth Edition

437 Pages·2008·5.05 MB·English

by  Reinhard Bachmann

HANDBOOK OF TRUST RESEARCH

Handbook of Trust Research
Edited by
Reinhard Bachmann
Associate Professor of Management,Birkbeck College,University of
London, UK
Akbar Zaheer
Curtis L.Carlson Professor of Strategic Management and Organization
and Director, Strategic Management Research Center,Carlson School of
Management, University of Minnesota,USA
Edward Elgar
Cheltenham,UK • Northampton,MA,USA
© Reinhard Bachmann and Akbar Zaheer 2006
All rights reserved.No part of this publication may be reproduced,stored in a retrieval system or
transmitted in any form or by any means,electronic,mechanical or photocopying,recording,or
otherwise without the prior permission of the publisher.
Published by
Edward Elgar Publishing Limited
Glensanda House
Montpellier Parade
Cheltenham
Glos GL50 1UA
UK
Edward Elgar Publishing,Inc.
136 West Street
Suite 202
Northampton
Massachusetts 01060
USA
A catalogue record for this book
is available from the British Library
Library ofCongress Cataloguing in Publication Data
Handbook of trust research / edited by Reinhard Bachmann,Akbar Zaheer.
p.cm.– (Elgar original reference)
Includes bibliographical references and index.
1.Organizational behavior—Research.2.Trust—Research.3.
Interpersonal relations—Research.4.Interorganizational
relations—Research.5.Organizational sociology—Research.I.Bachmann,
Reinhard,1961– II.Zaheer,Akbar,1952– III.Series.
HD58.7.H366 2006
302.3(cid:1)5—dc22 2006004280
ISBN-13:978 1 84376 754 1 (cased)
ISBN-10:1 84376 754 6 (cased)
Printed and bound in Great Britain by MPG Books Ltd,Bodmin,Cornwall
Contents
List of contributors vii
Introduction 1
Reinhard Bachmann and Akbar Zaheer
PART I MICRO OR INDIVIDUAL LEVEL
1 Three fundamental questions regarding trust in leaders 15
Kurt T.Dirks
2 Reflections on an initial trust-building model 29
D.Harrison McKnight and Norman L.Chervany
3 Can groups be trusted? An experimental study of trust in
collective entities 52
Bill McEvily,Roberto A.Weber,Cristina Bicchieri and Violet T.Ho
4 Trust as situated cognition:an ecological perspective on trust decisions 68
Roderick M.Kramer
PART II ORGANIZATIONAL OR INTER-ORGANIZATIONAL
LEVEL
5 Trust in the balance:how managers integrate trust-building and
task control 87
Chris P.Long and Sim B.Sitkin
6 Opportunism,trust and knowledge:the management of firm value
and the value of firm management 107
Anoop Madhok
7 Trust,transaction cost economics,and mechanisms 124
Philip Bromiley and Jared Harris
8 Relying on trust in cooperative inter-organizational relationships 144
Andrew H.Van de Ven and Peter Smith Ring
9 The dark side of trust 165
Martin Gargiulo and Gokhan Ertug
10 Trust,codification and epistemic communities:implementing an
expert system in the French steel industry 187
Richard Arena,Nathalie Lazaric and Edward Lorenz
11 Trust attitudes,network tightness and organizational survival:
an integrative framework and simulation model 199
Arjen van Witteloostuijn and Marc van Wegberg
12 Learning about contracts:trust,cooperation and contract law 218
Simon Deakin
v
vi Handbook of trust research
PART III CROSS-LEVEL APPROACHES
13 On the complexity of organizational trust:a multi-level
co-evolutionary perspective and guidelines for future research 235
Steven C.Currall and Andrew C.Inkpen
14 Forms,sources and processes of trust 247
Bart Nooteboom
15 Levels of inter-organizational trust:conceptualization and measurement 264
Martyna Janowicz and Niels Noorderhaven
16 Does trust still matter? Research on the role of trust in
inter-organizational exchange 280
Bill McEvily and Akbar Zaheer
PART IV TRUST AT THE LEVEL OF SOCIETY AND THE ECONOMY
17 An ethical analysis of the trust relationship 303
Sanjay Banerjee,Norman E.Bowie and Carla Pavone
18 Trust and markets 318
Jens Beckert
19 The economics of trust 332
Mark Casson and Marina Della Giusta
20 Trust,institutions,agency:towards a neoinstitutional theory of trust 355
Guido Möllering
21 How can systems trust systems? A structuration perspective on
trust-building in inter-organizational relations 377
Jörg Sydow
22 Trust and/or power:towards a sociological theory of
organizational relationships 393
Reinhard Bachmann
Index 409
List of contributors
Richard Arenais Professor at the University ofNice Sophia Antipolis.His research focuses
on issues of economic and social analyses of industrial organizations.He has published in
journals such as Cambridge Journal ofEconomics,History ofEconomic Ideasetc.Together
with C. Dangel-Hagnauer, he is the editor of The Contribution of J.A. Schumpeter to
Economics Development(Routledge,2002).
ReinhardBachmannisAssociateProfessor(Reader)inManagementattheUniversityof
London, Birkbeck College. He has published widely in journals such as Organization
Studies,BritishJournalof Sociology,CambridgeJournalof Economicsetc.Togetherwith
Christel Lane, he edited Trust Within and Between Organizations (Oxford University
Press,1998/2000).In2001heeditedaspecialissueof OrganizationStudieson‘Trustand
Control in Organizational Relations’ (with David Knights and Jörg Sydow). He is a
member of the Editorial Boards of Organization and Organization Studies. His work
emphasizestheroleofsocialmechanisms(trust,poweretc.)andsocietalinfluences(insti-
tutionalarrangements,culturaltraditions)onthestructureandqualityof organizational
relationshipsandbusinessstrategies.
Sanjay Banerjee is a PhD student in Accounting at the University of Minnesota. His
research interests include information economics,financial reporting and disclosure.He
has a BS in aerospace engineering from the Indian Institute ofTechnology,an MBA from
XLRI,India,and an MSc in service management from the University of Buckingham,
London.In his last corporate assignment with a global travel company,he was looking
after new projects and business development.
Jens Beckertis Professor of Sociology and Director of the Max-Planck-Institute for the
Study of Societies in Cologne. Previously he was Professor of Sociology at the Georg-
August-University, Göttingen. He was a Visting Fellow at the sociology department of
Princeton University in 1994/95 and at the Center for European Studies of Harvard
University in 2001/02.He is the author of Beyond the Market.The Social Foundations of
Economic Efficiency(Princeton University Press,2002).Together with Milan Zafirovski,
he is the editor of the International Encyclopedia of Economic Sociology (Routledge,
2005). He has published in journals such as Theory and Society, Journal of Economic
Issuesand Organization Studies.
Cristina Bicchieriis Carol and Michael Lowenstein Endowed Term Chair and Professor
of Philosophy and Director of the Philosophy, Politics and Economics Program at the
University of Pennsylvania.Previously she was Professor of Philosophy and Social and
Decision Sciences, Carnegie Mellon University. She is the author of Rationality and
Coordination(1993/97) and The Grammar of Society:the Nature and Dynamics of Social
Norms (2006), both by Cambridge University Press. Her research includes work on the
logical foundations of game theory, applications of game-theoretic and evolutionary
models to distributed artificial intelligence,and social norms and impersonal trust.
vii
viii Handbook of trust research
Norman E.Bowieis the Elmer L.Andersen Professor in Corporate Responsibility at the
University of Minnesota. He is the author or editor of 15 books and over 75 scholarly
articles in business ethics and related fields.His most recent book is Management Ethics
(Blackwell,2004) and his most recent edited book is Blackwell Guide to Business Ethics
(2002).His authoritative co-edited text Ethical Theory and Business(Prentice Hall,2003)
is in its seventh edition.He has held a position as Dixons Professor ofBusiness Ethics and
Social Responsibility at the London Business School and been a fellow at Harvard’s
Program in Ethics and the Professions.
Philip Bromiley is Professor in Organization and Strategic Management at the Merage
School of the University of California, Irvine. Previously he held the Curtis L. Carlson
Chair in Strategic Management and chaired the Department ofStrategic Management and
Organization at the University of Minnesota.He has published widely on organizational
decision-making and strategic risk-taking.He served on the Editorial Boards of Academy
of Management Journaland Organization Science,and as associate editor for Management
Science.He currently serves on the boards of Strategic Management Journaland Strategic
Organization.He also edits the Blackwell series on Theories of Strategic Management.
Mark Casson is Professor of Economics and Director of the Centre for Institutional
Performance at the University of Reading, UK. He has published widely on the eco-
nomics ofthe multinational enterprise,entrepreneurship and business culture,in addition
to publishing over 30 books in these areas,including The Economics of Business Culture
(Oxford University Press, 1991), Enterprise and Leadership (Edward Elgar, 2000) and
Economics of International Business:A New Research Agenda(Edward Elgar,2000).He
is particularly interested in the economic costs and benefits of institutional investments
in trust-building.
Norman L. Chervany is Carlson Professor of Information and Decision Sciences at the
Carlson School of Management,University of Minnesota.He received his doctorate in
decision sciences from Indiana University.His research focuses on human issues in the use
of technology. His specific research interests revolve around the relationships among
information technology/systems and organizational strategy,the role oftrust in an organ-
ization’s information management enterprise,work design issues in systems development,
and the implementation of systems projects.His work is widely published in such outlets
as MIS Quarterly,Management Scienceand Decision Sciences.
Steven C. Currall is Professor of Enterprise and the Management of Innovation and
Director of the Centre for Enterprise and the Management of Innovation at University
College London and Visiting Professor at London Business School. Previously he was
William and Stephanie Sick Professor of Entrepreneurship at Rice University. He con-
ducts research in the areas of emerging technology companies, trust and cor-
porate governance. He serves on the Editorial Review Boards of the Journal of
Organizational Behaviorand Academy of Management Perspectives.
Simon Deakin is the Robert Monks Professor of Corporate Governance in the Judge
Institute of Management Studies,University of Cambridge.In addition he is a Fellow of
Contributors ix
Peterhouse and Yorke Professorial Research Fellow in the Faculty of Law at Cambridge.
He is co-author ofMarkesinis and Deakin’s Tort Law(Clarendon Press,5th edition,2003)
and of Labour Law(Butterworths,2nd edition,1998) (with G.Morris).Also,he has pub-
lished widely in journals such as the Cambridge Journal of Economics,Organizationand
Industrial Relations Journal. Present research includes work on corporate law and eco-
nomic performance,reflexive law and democratic governance,and the modernization of
employment institutions.
Marina Della Giustais a Lecturer in Economics at the University of Reading,UK.Her
research interests lie in the field of institutional economics,focusing particularly on the
roles of institutions and social mechanisms in market access.Her main publications are
in the areas ofmicro-finance and social capital as well as the institutional design ofdevel-
opment organizations.She is currently doing work on the economics of trust,on social
capital and well-being,the economics ofprostitution,and the responses ofinstitutions to
changes in development models.She has an active interest in fair trade and trade regula-
tion issues,on which she works with an NGO based in Reading.
Kurt T.Dirksis currently Associate Professor at the John M.Olin School of Business at
Washington University in St Louis. He has published in the Journal of Applied
Psychology, Academy of Management Review, Organization Science etc. He is on the
Editorial Board ofOrganization Science.His research is focused on trust in the workplace,
including its antecedents,consequences and processes.He also conducts research on feel-
ings of ownership.
Gokhan Ertug is Sasakawa Fellow and a PhD candidate in Organizational Behavior at
INSEAD.His research interests include the affiliation basis of status,the effects of social
networks on cooperation and competition,and the undesirable consequences ofexcessive
trust in organizations.
Martin Gargiulo is an Associate Professor of Organizational Behavior at INSEAD in
Singapore.He received his PhD in sociology from Columbia University.He has published
his work in journals such as Administrative Science Quarterly,Academy of Management
Journaland American Journal of Sociology.His research focuses on the effects of social
networks on interpersonal and interorganizational cooperation,as well as the effects of
this cooperation or lack thereof on individual and organizational performance.
JaredHarrisisan Assistant Professor at the University of Virginia’s Darden Graduate
School ofBusiness.His work on financial misrepresentation won the University ofNotre
Dame’s 2005 Excellence in Ethics Dissertation Competition,and qualified him as a final-
ist forthe2005INFORMS/OrganizationScienceDissertationCompetition.While com-
pleting his studies at the University of Minnesota, Jared received doctoral fellowships
fromtheStrategicManagementSociety,theJuranCenterforLeadershipinQuality,and
theBusinessRoundtableInstituteforCorporateEthics.
Violet T.Hois Assistant Professor at Nanyang Business School,Nanyang Technological
University of Singapore. She received her PhD in Organizational Behavior and Theory