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

  • Zhe Zhang


  • Ming Jia


  • Difang Wan


Registered author(s):

    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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    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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