Governance Structures and Trust: a Study of Real Estate Networks

The present study aimed at verifying how different modes of governance structure are linked to different levels of interorganisational trust. Its theoretical grounding involves Transaction Cost Theory, which studies governance of interorganisational arrangements and research on trust in the business field. A descriptive and quantitative approach has been adopted to describe the relation between trust amongst business network participants and the mode of governance adopted by the surveyed networks. Hence, a detailed questionnaire has been employed, which was answered by 35 real estate agency managers, whose participation was directly linked to 11 business networks. By using Spearman methods of identification of non-parametric correlation and correspondence analysis, it was possible to verify that certain modes of governance structure associate with different levels of trust. Considering the scarcity of quantitative research on the theme, this paper contributes to the field by presenting results which point out that collectively-managed governance of regional cooperation networks is linked to high levels of trust; whereas governance of dispersed networks with the presence of a lead company are linked to low levels of trust. Medium levels of trust were observed in networks governed by an administrative organisation. Considering the practical aspect of administration in networks, one can conclude that the process of governance structure in such interorganisational arrangements should include deliberations about the influence of the adopted mode of governance on trust amongst participants. The paper does not allow generalizations of its conclusions beyond its chosen sample

Governance Structures and Trust: a Study of Real Estate Networks

The present study aimed at verifying how different modes of governance structure are linked to different levels of interorganisational trust. Its theoretical grounding involves Transaction Cost Theory, which studies governance of interorganisational arrangements and research on trust in the business field. A descriptive and quantitative approach has been adopted to describe the relation between trust amongst business network participants and the mode of governance adopted by the surveyed networks. Hence, a detailed questionnaire has been employed, which was answered by 35 real estate agency managers, whose participation was directly linked to 11 business networks. By using Spearman methods of identification of non-parametric correlation and correspondence analysis, it was possible to verify that certain modes of governance structure associate with different levels of trust. Considering the scarcity of quantitative research on the theme, this paper contributes to the field by presenting results which point out that collectively-managed governance of regional cooperation networks is linked to high levels of trust; whereas governance of dispersed networks with the presence of a lead company are linked to low levels of trust. Medium levels of trust were observed in networks governed by an administrative organisation. Considering the practical aspect of administration in networks, one can conclude that the process of governance structure in such interorganisational arrangements should include deliberations about the influence of the adopted mode of governance on trust amongst participants. The paper does not allow generalizations of its conclusions beyond its chosen sample

Formal and Relational Mechanisms of Network Governance and their Relationship with Trust: Substitutes or Complementary in Brazilian Real Estate Transactions?

The objective of this study was to investigate whether formal and relational mechanisms of network governance act as substitutes or are complementary in their relationship with trust in the intermediation activity of real estate transactions. A quantitative research was conducted to test the hypotheses. Data was collected via a survey and the context was Brazilian real estate business networks. A non-parametric approach was used to investigate the associations among the key variables indicated in the theory. The results confirm the hypothesis that formal and relational mechanisms of network governance act as complementary and reject the possibility of substitution between them. Both mechanisms are important to build trust-based relationships between actors, and formal governance mechanisms have a significant positive relationship with interorganisational trust, while relational mechanisms are positively associated with interpersonal trust. This study not only contributes to the discussion of governance mechanisms and their relationship with trust, but also broadens this debate by considering trust at different levels and present in more complex structures where these relationships are still little explored, such as is the case of business networks