The Influence of Power on Trust in Buyer−Supplier Relationships
Prof. Nuno Barros De Oliveira
Trust is among the most critical factors in buyer−supplier relationships. In an effort to understand the origins of trust, power has become the focus of a burgeoning literature. However, research about the influence of power on trust have been plagued by inconsistencies as to whose power and whose trust is being examined, which has led to confusion and hindered cumulative progress. We address this issue by disentangling the effect of the focal organization (the actor effect) from the effect specific to its partner (the partner effect) and accounting for both simultaneously. We further theorize and show that the partner’s level of self-promotion about its own achievements and credentials moderates both the actor and the partner effects, thus adding knowledge about a contingency that accounts for considerable variation in the linkage between power and trust. Using multi-informant, dyadic survey data paired with archival information scraped from firms’ webpages, we find that (i) actors low (vs. high) in power tend to place more trust (ii) while simultaneously engendering higher levels of their partners’ trust, (iii) but these effects differ markedly depending on the partner’s level of self-promotion. Our study offers a novel, integrative perspective of power and trust, and we elaborate its important implications for understanding buyer−supplier relationships.
Keywords: Trust, Trustworthiness, Survey, Interorganizational relationships, Supply chain management.