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When does a partner’s reputation impact cooperation effects in partnerships?

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  • Zhe Zhang

    ()

  • Ming Jia

    ()

  • Difang Wan

    ()

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    Abstract

    We examine how formal contracts moderate the relationship between a partner’s reputation and cooperation effects in public-private (P-P) partnerships. We base our analysis on differences between formal contracts, which require a series of legal agreements, and informal contracts, which may be implicit and/or unwritten. We argue that a partner’s reputation is more likely to impact cooperation effects in the context of strong formal or informal contracts. Using a sample of 244 partners from various P-P partnerships in the medical and healthcare fields in China, we find that the positive relationship between a partner’s reputation and cooperation effects is stronger given the existence of strong formal and/or informal contracts. We conclude that in China, where there is a weak legal system that rarely offers or enforces sufficient protections to contract signatories, it is safer to cooperate with a partner who has a good reputation. Such a reputation correspondingly enhances cooperation effects. Moreover, this relationship may be amplified when there are strong formal and/or informal contracts, all of which may be associated with cooperation between the public and private sectors. Copyright Springer Science+Business Media, LLC 2012

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    File URL: http://hdl.handle.net/10.1007/s10490-010-9197-5
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    Bibliographic Info

    Article provided by Springer in its journal Asia Pacific Journal of Management.

    Volume (Year): 29 (2012)
    Issue (Month): 3 (September)
    Pages: 547-571

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    Handle: RePEc:kap:asiapa:v:29:y:2012:i:3:p:547-571

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    Postal: P.O. Box 17, 3300 AA Dordrecht, the Netherlands
    Web page: http://www.springerlink.com/link.asp?id=106589

    Related research

    Keywords: P-P partnerships; Partner reputation; Cooperation effects; Formal contract; Informal contract; China;

    References

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    Cited by:
    1. Sánchez de Pablo González del Campo, Jesús David & Peña García Pardo, Isidro & Hernández Perlines, Felipe, 2014. "Influence factors of trust building in cooperation agreements," Journal of Business Research, Elsevier, vol. 67(5), pages 710-714.
    2. Lee, Peter K.C. & Lau, Antonio K.W. & Cheng, T.C.E., 2013. "Employee rights protection and financial performance," Journal of Business Research, Elsevier, vol. 66(10), pages 1861-1869.

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