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Effect of Formal Contracts, Relational Norms and Trust on Performance of Joint Research and Development Projects

Arranz, N and de Arroyabe, JCF (2012) 'Effect of Formal Contracts, Relational Norms and Trust on Performance of Joint Research and Development Projects.' British Journal of Management, 23 (4). 575 - 588. ISSN 1045-3172

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Abstract

This paper examines the effect of governance mechanisms - formal contracts, relational norms and trust - on the performance of exploration and exploitation joint research and development (R&D) projects. While the authors acknowledge the need for a twofold approach, transactional and relational, to understand the interfirm exchange governance, the joint action of formal contracts and relational governance has been caught between the complementary or substitutive forces involved in interorganizational relationships. Using survey data on joint exploration and exploitation R&D projects developed by the European biotechnology companies, the synergies of both mechanisms and their effects in improving project performance are investigated. The analysis suggests that contracts and relational norms and trust act as complementary mechanisms, but while contracts are more effective in exploitation projects, relational norms and trust are more powerful in improving the performance of exploration projects. © 2011 British Academy of Management.

Item Type: Article
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
H Social Sciences > HF Commerce
Divisions: Faculty of Social Sciences > Essex Business School
Faculty of Social Sciences > Essex Business School > Management Science and Entrepreneurship Group
Depositing User: Jo Wiltshire
Date Deposited: 18 Sep 2013 10:34
Last Modified: 01 Feb 2019 14:15
URI: http://repository.essex.ac.uk/id/eprint/7644

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