Effects of cultural ethnicity, firm size, and firm age on senior executives' trust in their overseas business partners: Evidence from China

We investigate trust relationships between senior business executives and their overseas partners. Drawing on the similarity-attraction paradigm, social categorization theory, and the distinction between cognition-and affect-based trust, we argue that executives trust their overseas partners differe...

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Bibliographic Details
Published in:Journal of international business studies 2011-12, Vol.42 (9), p.1150-1173
Main Authors: Jiang, Crystal X, Chua, Roy YJ, Kotabe, Masaaki, Murray, Janet Y
Format: Article
Language:English
Subjects:
Age
Business and Management
Business executives
Business partners
Business Strategy/Leadership
Business structures
China
Chinese culture
Cognition
Cognition & reasoning
Cognitive models
Cooperation
Correlation analysis
Culture
Ethnicity
Executives
Hypotheses
Influence
International Business
Investigations
Japanese culture
Management
Modeling
Organization
Partners
Psychological research
Senior management
Size of enterprise
Social psychology
Studies
Trust
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Summary:We investigate trust relationships between senior business executives and their overseas partners. Drawing on the similarity-attraction paradigm, social categorization theory, and the distinction between cognition-and affect-based trust, we argue that executives trust their overseas partners differently, depending on the partners' cultural ethnicity. In a field survey of 108 Chinese senior executives, we found that these executives have higher affect-based trust in overseas partners of the same cultural ethnicity as themselves; cognition-based trust is associated with affect-based trust differently when overseas partners are of the same or different cultural ethnicity. We also examine the role of relative firm size and age in shaping intra- and intercultural trust. Relative firm size has a stronger negative effect on executives' cognition-based trust if their partners are of a different cultural ethnicity. Although firm age does not have a negative effect on executives' affectbased trust as hypothesized, we found firm age to be positively associated with affect-based trust for partners of the same cultural ethnicity. We discuss theoretical and practical implications of this pattern of inter- and intra-cultural trust on international business and networking (guanxi) dynamics in China.
ISSN:0047-2506
1478-6990
DOI:10.1057/jibs.2011.35