The containment of opportunism in the post formation period of inter-organizational relationships (original) (raw)

This paper analyzes the post formation period of IORs on the basis of the assumption that opportunism -particularly between competitors -remains a key problem after the formation and structuring of the IOR. As opportunism negatively influences the performance of the IOR, it will be shown that it is important to understand the factors which foster the willingness to cooperate. The paper combines TCE-and resource-based theory perspectives to explain ex post cooperative behavior of the partners. In so doing, it integrates both governance and resource related issues for a more comprehensive view of the post formation period. It is proposed that there are 4 factors that largely determine whether ex post opportunism will be successfully suppressed in an ongoing relationship: 1) the complexity of the ex ante formal contract, 2) the efforts made by the partners to establish and encourage trust, 3) the degree of sustained resource complementarity, and 4) the level of interdependencies. These factors are shown to be intertwined and to have effects in fostering sustained cooperative behavior and success of the partnership. This theoretical concept will be supported by empirical data gathered in the context of a case study of an IOR between two European airlines.