ISOLATING TRUST OUTCOMES FROM EXCHANGE RELATIONSHIPS: SOCIAL EXCHANGE AND LEARNING BENEFITS OF PRIOR TIES IN ALLIANCES

Social exchange theory is a broad theory that has been used to explain frost as an outcome of various exchange relationships, and research commonly presumes trust exists between exchange partners that have prior relationships. In this paper, we contribute to research on social exchange theory by isolating the trust outcomes of interorganizational exchanges from other outcomes emphasized by learning and knowledge-based perspectives, and by specifying important boundary conditions for the emergence of trust in interorganizational exchanges. We make such a theoretical contribution within the domain of strategic alliances by investigating the effects of previous alliance agreements, or prior ties, between the partnering firms. We find that prior ties generally lead to learning about a partner's anticipated behavioral patterns, which helps a firm predict when self-interested behavior may occur and know how to interact with the partner during the coordination and execution of the alliance tasks. By contrast, the kind of trust emphasized in social exchange theory is not generally rooted in prior ties and only emerges from prior relationships under certain conditions. We discuss the implications of these findings for research on social exchange theory.