The Trust Levels, Trust Determinants, and Spatial Dimensions in Inter-Firm Relationships: A Warehousing Firm’s Perspective in the City of Busan, South Korea

Sinje Sung, Sangmok Kang

Department of Economics, College of Economics and International Trade, Pusan National University, Busan, South Korea..
Department of Geography, University of Connecticut, Storrs, USA.

DOI: 10.4236/ib.2012.44046                

Abstract

This study analyzes the trust level relationships of the warehousing industry firms in the city of Busan, South Korea in regards to their determinants and spatial dimensions. A firm’s environment, such as reputation and renown, forms the relationship between the firm and other firms. The trust levels between firms were determined by the determinants of the trust: Long-term and repeated interaction, information sharing and reciprocity, and interdependence and asset specificity all had an important effect upon the micro or highest level of trust. Proximity and uncertainty influenced the meso or middle level of trust. The culture and norms of the firms & institutional formality affected the macro or lowest level of trust. It was found that the higher the trust levels, the more the respective spatial dimensions generated by the relationship between firms expanded to the national and international dimensions.

Keywords

Trust Levels; Determinants of the Trust; Spatial Dimensions; Warehouse Firms; Busan

Conflicts of Interest

The authors declare no conflicts of interest.

References

[1]	A. Darr and I. Talmud, “The Structure of Knowledge and Seller-Buyer Networks in Markets for Emergent Technologies,” Organization Studies, Vol. 24, No. 3, 2003, pp. 443-461. doi:10.1177/0170840603024003911
[2]	B. Uzzi and R. Lancaster, “Relational Embeddedness and Learning: The Case of Bank Loan Managers and Their Clients,” Management Science, Vol. 49 No. 4, 2003, pp. 383-399. doi:10.1287/mnsc.49.4.383.14427
[3]	G. A. Bigley and J. L. Pearce, “Straining for Shared Meaning in Organizational Science: Problems of Trust and Distrust,” Academy of Management Review, Vol. 23, No. 3, 1998, pp. 405-422.
[4]	P. Di Maggio and H. Louch, “Socially Embedded Consumer Transactions: For What Kinds of Purchases Do People Most Often Use Network?” American Sociological Review, Vol. 63, No. 3, 1998, pp. 619-637. doi:10.2307/2657331
[5]	M. S. Mizruchi and L. B. Stearns, “Getting Deals Done: The Use of Social Networks in Bank Decision-Making,” American Sociological Review, Vol. 66, No. 5, 2001, pp. 647-671. doi:10.2307/3088952
[6]	B. McEvily, V. Perrone and A. Zaheer, “Trust as an Organizing Principle,” Organization Science, Vol. 14, No. 1, 2003, pp. 91-103. doi:10.1287/orsc.14.1.91.12814
[7]	M. Carney, “The Competitiveness of Network Production: The Role of Trust and Asset Specificity,” Journal of Management Studies, Vol. 35, No. 4, 1998, pp. 457-479. doi:10.1111/1467-6486.00105
[8]	M. Sako, “The Role of Trust in Japanese Buyer-Supplier Relationships,” Ricerche Economiche, Vol. 45, No. 2-3, 1991, pp. 449-474.
[9]	M. Sako and S. Helper, “Determinants of Trust in Supplier Relations: Evidence from the Automotive Industry in Japan and United States,” Journal of Economic Behavior and Organization, Vol. 34, No. 3, 1998, pp. 387-417. doi:10.1016/S0167-2681(97)00082-6
[10]	S. Goran, “Perceived Trust towards Suppliers and Customers in Supply Chains of the Swedish Automotive Industry,” International Journal of Physical Distribution & Logistics Management, Vol. 31, No. 9-10, 2001, pp. 635-650.
[11]	R. Handfield and C. Bechtel, “Writing the Ideal Paper for JOM: A New Editor’S Perspective,” Journal of Operations Management, Vol. 20, No. 1, 2002, pp. 10-18.
[12]	I. W. Kwon and T. W. Suh, “Factors Affecting the Level of Trust and Commitment in Supply Chain Relationships,” The Journal of Supply Chain Management, Vol. 40, No. 2, 2004, pp. 4-14. doi:10.1111/j.1745-493X.2004.tb00165.x
[13]	S. L. Golicic, “A Comparison of Shipper and Carrier Relationship Strength,” International Journal of Physical Distribution & Logistics Management, Vol. 37, No. 9, 2007, pp. 719-739. doi:10.1108/09600030710840831
[14]	C. Niezen, W. Weller and H. Deringer, “Demanding Better Management,” Business Strategy Review, Vol. 18, No. 1, 2007, pp. 47-49. doi:10.1111/j.1467-8616.2007.00454.x
[15]	M. Sambasivan and N. Y. Ching, “Strategic Alliance in a Manufacturing Supply Chain: Influence of Organization Culture from the Manufacturer’S Perspective,” International Journal of Physical Distribution & Logistics Management, Vol. 40, No. 6, 2010, pp. 456-474. doi:10.1108/09600031011062191
[16]	J. Bowen, “Moving Place: The Geography of Warehousing in the US,” Journal of Transport Geography, Vol. 16, No. 6, 2008, pp. 379-387. doi:10.1016/j.jtrangeo.2008.03.001
[17]	C. Quinn, “Warehouses Big Growth Trend in Exurbs,” Atlanta Journal Constitution, No. 24, 2005, p. 3E.
[18]	O. Klein, “Social Perception of Time, Distance, and High-Speed Transportation,” Time and Society, Vol. 13 No. 2-3, 2004, pp. 245-263. doi:10.1177/0961463X04043504
[19]	R. M. Morgan and S. D. Hunt, “The Commitment-Trust Theory of Relationship Marketing,” Journal of Marketing, Vol. 58, No. 3, 1994, pp. 20-38. doi:10.2307/1252308
[20]	Y. Aoyama and S. J. Ratick, “Trust, Transactions, and Information Technologies in the US Logistics Industry,” Economic Geography, Vol. 83, No. 2, 2007, pp. 159-180. doi:10.1111/j.1944-8287.2007.tb00341.x
[21]	M. Sako, “Prices, Quality and Trust: Inter-Firm Relation in Britain and Japan,” Cambridge University Press, Cambridge, 1992.
[22]	R. J. Lewicki and B. B. Bunker, “Developing and Maintaining Trust in Work Relationships,” In: R. M. Kramerand and T. R. Tyler, Eds., Trust in Organizations: Frontiers of Theory and Research, Sage Publications, London, 1996, pp. 114-139. doi:10.4135/9781452243610.n7
[23]	J. T. Murphy, “Building Trust in Economic Space,” Progress in Human Geography, Vol. 30, No. 4, 2006, pp. 427-450. doi:10.1191/0309132506ph617oa
[24]	M. A. Hitt, L. Bierman, K. Shimizu and R. Kochhar, “Direct and Moderating Effects of Human Capital on Strategy and Performance in Professional Service Firms: A Resource-Based Perspective,” Academy of Management Journal, Vol. 44, No. 1, 2001, pp. 13-28. doi:10.2307/3069334
[25]	K. Knorr-Cetina and U. Bruegger, “Global Microstructures: The Virtual Societies of Financial Markets,” American Journal of Sociology, Vol. 107, No. 4, 2002, pp. 905-950. doi:10.1086/341045
[26]	E. J. Lawler, “An Affect Theory of Social Exchange,” American Journal of Sociology, Vol. 107, No. 2, 2001, pp. 321-352. doi:10.1086/324071
[27]	M. Emirbayer and V. Johnson, “Bourdieu and Organizational Analysis,” Theory and Society, Vol. 37, No. 1, 2008, pp. 1-44. doi:10.1007/s11186-007-9052-y
[28]	R. Axelrod, “The Evolution of Cooperation,” Basic Books, New York, 1984.
[29]	D. M. Krep, “Corporate Culture and Economic Theory,” In: E. J. Alt and K. A. Shepsle, Eds., Perspective on Positives Political Economy, Cambridge University Press, Cambridge, 1990, pp. 90-143.
[30]	P. S. Aulakh, M. Kotabe and A. Sahay, “Trust and Performance in Cross-Border Marketing Partnerships: Behavioural Approach,” Journal of International Business Studies, Vol. 27 No. 5, 1996, pp. 1005-1032. doi:10.1057/palgrave.jibs.8490161
[31]	L. G. Zucker, “Production of Trust: Institutional Sources of Economic Structure, 1840-1920,” Research in Organizational Behavior, Vol. 8, 1986, pp. 53-111.
[32]	J. Coleman, “Social Capital in the Creation of Human Capital,” American Journal of Sociology, Vol. 94, 1988, pp. 95-120. doi:10.1086/228943
[33]	A. Parkhe, “Strategic Alliance Structuring: A Game Theoretic and Transaction Cost Examination of Interfirm Cooperation,” Academy of Management Journal, Vol. 36, No. 4, 1993, pp. 794-829. doi:10.2307/256759
[34]	J. H. Dyer, “Effective Interfirm Collaboration: How Firm Minimize Transaction Costs and Maximize Transaction Value,” Strategic Management Journal, Vol. 18, No. 7, 1997, pp. 535-556. doi:10.1002/(SICI)1097-0266(199708)18:7<535::AID-SMJ885>3.0.CO;2-Z
[35]	Y. L. Doz and G. Hamel, “Alliance Advantage,” Harvard Business School Press, Cambridge, 1998.
[36]	D. Shin and J. Lee, “Trust in Lean Production Systems: Lean Job Design and Sources of Workers’: Trust in Management at Korean Automobile Plants,” The Academy of Management Annual Conference, Chicago, August 6-11 1999.
[37]	J. H. Dyer and H. Singh, “The Relational View: Cooperative Strategy and Sources of Interorganizational Competitive Advantage,” Academy of Management Review, Vol. 23, No. 4, 1998, pp. 660-679.
[38]	F. R. Dwyer, P. H. Schurr and O. Sejo, “Developing Buyer-Seller Relationship,” Journal of Marketing, Vol. 51, No. 2, 1987, pp. 11-27. doi:10.2307/1251126
[39]	J. Buchanan, “From the Inside Looking out,” In: S. Michael, Ed., Eminent Economists: Their Life Philosophies, Cambridge University Press, Cambridge, 1992, pp. 98-106.
[40]	R. F. Lusch and J. R. Brown, “Interdependency, Contracting, and Relational Behavior in Marketing Channels,” Journal of Marketing, Vol. 60, No. 4, 1996, pp. 19-38. doi:10.2307/1251899
[41]	J. B. Heide and A. S. Miner, “The Shadow of the Future: Effects of Anticipated Interaction and Frequency of Contract on Buyer-Seller Cooperation,” Academy of Management Journal, Vol. 35, No. 2, 1992, pp. 265-291. doi:10.2307/256374
[42]	J. B. Heide and G. John, “Alliances in Industrial Purchasing: The Determinants of Joint Action in Buyer-Supplier Relationship,” Journal of Marketing Research, Vol. 27, No. 1, 1990, pp. 24-36. doi:10.2307/3172548
[43]	O. E. Williamson, “Calculativeness, Trust, and Economic-Organization,” Journal of Law and Economics, Vol. 36, No. 2, 1993, pp. 453-486. doi:10.1086/467284
[44]	O. E. Williamson, “The Economic Institutions of Capitalism,” The Free Press, New York, 1985.
[45]	G. Walker and D. Weber, “A Transaction Cost Approach to Make-or-Buy Decisions,” Administrative Science Quarterly, Vol. 29, No. 3, 1984, pp. 373-391. doi:10.2307/2393030
[46]	P. Cooke and K. Morgan, “The Associational Economy: Firms, Regions and Innovation,” Oxford University Press, Oxford, 1998.
[47]	M. Granovetter, “Economic Action and Social Structure: The Problem of Embeddedness,” American Journal of Sociology, Vol. 91, No. 3, 1985, pp. 481-510. doi:10.1086/228311
[48]	M. Smitka, “Competitive Ties: Subcontracting in the Japanese Automotive Industry,” Columbia University Press, New York, 1991.
[49]	P. DiMaggio and W. W. Powell, “Iron-cage Revisited: Institutional Isomorphism and Collective Rationality in Organizational Fields,” American Sociological Review, Vol. 48, No. 2, 1983, pp. 147-160.
[50]	D. Sirdeshmukh, J. Singh and B. Sabol, “Consumer Trust, Value, and Loyalty in Relational Exchanges,” Journal of Marketing, Vol. 66, No. 1, 2002, pp. 15-37. doi:10.1509/jmkg.66.1.15.18449