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Safeguarding investments and creation of transaction value in asymmetric international subcontracting relationships: The role of relationship learning and relational capital

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  • Chang, Kuo-Hsiung
  • Gotcher, Donald F.

Abstract

This study examines how suppliers who do not have bargaining power to protect relationship-specific investments (RSIs) can use safeguarding mechanisms to create transaction value in the context of asymmetric international subcontracting partnerships. From a supplier perspective, two different types of bilateral safeguarding mechanisms, relationship learning and relational capital, play discrete roles in the process of creating transaction value. Drawing on a resource-based view (RBV) of the firm, this study proposes that RSIs (a firm's resources), can enhance relationship learning (capabilities), which in turn, facilitates dyadic capability enhancing (joint competitive advantage). In addition, from a social capital perspective, relational capital facilitates relationship learning and strengthens the positive relationship between RSIs and relationship learning. Relationship learning plays the key role, and acts as the catalyst in transforming RSIs and relational capital into dyadic capability enhancing. The hypotheses are tested using data from a survey of 118 Taiwanese supplier-international buyer relationships in information technology industries. The study finds that relationship learning mediates the relationship between RSIs and dyadic capability enhancing, and that relational capital moderates the relationship between RSIs and relationship learning.

Suggested Citation

  • Chang, Kuo-Hsiung & Gotcher, Donald F., 2007. "Safeguarding investments and creation of transaction value in asymmetric international subcontracting relationships: The role of relationship learning and relational capital," Journal of World Business, Elsevier, vol. 42(4), pages 477-488, December.
    • Handle: RePEc:eee:worbus:v:42:y:2007:i:4:p:477-488
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    10. Khan, Zaheer & Nicholson, John D., 2014. "An investigation of the cross-border supplier development process: Problems and implications in an emerging economy," International Business Review, Elsevier, vol. 23(6), pages 1212-1222.
    11. Chang, Kuo-Hsiung & Chen, Yung-ray & Huang, Hsu-Feng, 2015. "Information technology and partnership dynamic capabilities in international subcontracting relationships," International Business Review, Elsevier, vol. 24(2), pages 276-286.
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    14. Chin-Hung Tseng & Kuo-Hsiung Chang & Ho-Wen Chen, 2019. "Strategic Orientation, Environmental Innovation Capability, and Environmental Sustainability Performance: The Case of Taiwanese Suppliers," Sustainability, MDPI, vol. 11(4), pages 1-19, February.
    15. Wang, Lei & Zhang, Chun & Jiang, Fuming, 2019. "Matching governance mechanisms with transaction-specific investment types and supplier roles: An empirical study of cross-border outsourcing relationships," International Business Review, Elsevier, vol. 28(2), pages 316-327.
    16. Jean, Ruey-Jer Bryan & Kim, Daekwan & Chiou, Jyh-She & Calantone, Roger, 2018. "Strategic orientations, joint learning, and innovation generation in international customer-supplier relationships," International Business Review, Elsevier, vol. 27(4), pages 838-851.
    17. Liu, C.-L.E., 2012. "An investigation of relationship learning in cross-border buyer–supplier relationships: The role of trust," International Business Review, Elsevier, vol. 21(3), pages 311-327.
    18. Ruey-Jer Bryan Jean & Rudolf R. Sinkovics & Daekwan Kim, 2017. "Antecedents and Outcomes of Supplier Innovativeness in International Customer–Supplier Relationships: The Role of Knowledge Distance," Management International Review, Springer, vol. 57(1), pages 121-151, February.
    19. Jean, Ruey Jer Bryan & Kim, Daekwan & Choi, Kyuyeong, 2021. "Pattern of information technology use and relationship learning in international customer-supplier relationships," International Business Review, Elsevier, vol. 30(4).
    20. Verwaal, Ernst, 2017. "Global outsourcing, explorative innovation and firm financial performance: A knowledge-exchange based perspective," Journal of World Business, Elsevier, vol. 52(1), pages 17-27.
    21. Wei‐Jr Juo & Chao‐Hung Wang, 2022. "Does green innovation mediate the relationship between green relational view and competitive advantage?," Business Strategy and the Environment, Wiley Blackwell, vol. 31(5), pages 2456-2468, July.
    22. Khuram Shahzad, 2017. "From Transaction Cost Containment to Relationship Commitment: An Integrative Perspective of Buyer-Supplier Relationship Governance," MIC 2017: Managing the Global Economy; Proceedings of the Joint International Conference, Monastier di Treviso, Italy, 24–27 May 2017,, University of Primorska Press.
    23. Matteo Migheli, 2013. "Relational capital, profitability and access to credit: evidence from a sample of Italian small firms," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 60(2), pages 221-233, June.

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