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

Author

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  • Zhe Zhang

    ()

  • Ming Jia

    ()

  • Difang Wan

    ()

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

Suggested Citation

  • Zhe Zhang & Ming Jia & Difang Wan, 2012. "When does a partner’s reputation impact cooperation effects in partnerships?," Asia Pacific Journal of Management, Springer, vol. 29(3), pages 547-571, September.
  • Handle: RePEc:kap:asiapa:v:29:y:2012:i:3:p:547-571
    DOI: 10.1007/s10490-010-9197-5
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    References listed on IDEAS

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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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