Interpersonal Dependence and Interfirm Exchange: A Cross-national Study of Industrial Distributor - Supplier Relationships
By Keysuk (Steve) Kim
ABSTRACT
A glaring hole exists between academic literature and anecdotal observations on the role of interpersonal dependence for interfirm exchange. Academic literature, economics literature in particular, either frowns on or belittles the impact of interpersonal factors on interfirm exchange. In contrast, we very often hear people say that it is "who you know, not what you know," that counts for the success in business. This study aims to clarify the role of interpersonal factors in interfirm exchange by examining the effects of personal dependence on interfirm exchange and its outcomes in industrial distributor - supplier relationships. We propose that personal dependence has differential effect on interfirm exchange elements (distributor trust and distributor commitment) and that trust and commitment have differential effects on a behavioral outcome (supplier commitment) and an economic outcome (transaction cost savings). The proposed hypotheses were tested with data collected through survey of industrial distributors in the United States and Japan. The hypotheses on the effects of personal dependence on interfirm exchange elements received a strong support, whereas the hypotheses on the effects of interfirm exchange elements on exchange outcomes received partial support.
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