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The influence of relational experience and contractual governance on the negotiation strategy in buyer-supplier disputes

  • Lumineau, Fabrice
  • Henderson, James

This paper theoretically refines and empirically extends the debate on the type of interplay between relational experience and contractual governance in an under-researched area: supply chain disputes. We define relational experience as either cooperative or competitive; distinguish between control and coordination functions of contractual governance; and assess their interplay on the negotiation strategy used in disputes. Using a unique data set of buyer-supplier disputes, we find, in particular, that increasing contractual control governance weakens the positive effect of cooperative relational experience on cooperative negotiation strategy. However, increasing contractual control governance for a buyer-supplier dyad with competitive relational experience will increase cooperative negotiation strategy. Contractual coordination governance reinforces the positive effect of cooperative relational experience. Through this study, we reach a better understanding of how and when contractual and relational governance dimensions interact; rather than whether they act as substitutes or complements as has been studied in prior research. We discuss the implications of these findings for the field of supply chain management.

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File URL: https://mpra.ub.uni-muenchen.de/38510/1/MPRA_paper_38510.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 38510.

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Date of creation: 2012
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Handle: RePEc:pra:mprapa:38510
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