preferences in combination with reputation opportunities keep principals from abusing their power, leading to the widespread …

We explore the determinants and effects of trust relationships between upstream suppliers and downstream producers … different measures of supplier-buyer trust, that higher levels of trust mitigate relationship-specific underinvestment in a … classical hold-up situation. Moreover, contrary to the extant literature, we show that higher levels of supplier’s trust are …

&D investment, and derive predictions on the effects of trust and competition on suppliers’ investment and buyers’ procurement … - but also with more competitive procurement: trust and rents from reduced supplier competition in the procurement process … automotive industry. Consistent with the model’s predictions, higher levels of trust are associated with higher investment levels …

opportunistic behavior, but may cause the manager to pursue conservative courses of action to preserve his reputation. This … undermines the benefits of delegating control, leading to decreased managerial authority and stronger monetary incentives. When …