7Trust in Global Value Chains and the Role of Intermediaries
7.1 Introduction
It is well-accepted in economic and management research, that trust between exchange partners reduces transaction costs (Williamson 1981), improves information flows (Aoki 1988) and promotes cooperation and durable business relationships. However, the decision to trust the other party in an exchange always involves the assumption of risk on the part of the trustor (Mayer, Davis and Schoorman 1995). The trustor has incomplete information regarding the competence of the trustee, as well as uncertainty regarding the trustee’s intrinsic motivation to perform as expected and their interest in safeguarding the relationship.
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