Trust conditional on governance structure: Theory and evidence from case studies

Abstract

The paper proposes the idea that trust-based relationships can be established within the specific governance structures chosen by the agents. The theoretical background of this paper spans the literature from transaction cost and contract theory to supplier relationship management and trust theory. First communication and experience, risk perception attitude and the trade-off between trust and control are discussed within the analysis of trust source factors. Then these elements are considered in the light of Transaction Cost Economics. Three case studies are then presented in order to corroborate the theoretical proposition.