Unfortunately, this seminar has been cancelled due to illness and will be postboned to another date (TBA).

On Wednesday 18 November 2020 at 10:00 via Zoom, Sarah Maria Bruhs will give a seminar entitled   

How long I have known you vs. how much I trust you: Trust and learning effects in buyer-supplier contract design 
  

Abstract
As buyers and suppliers interact repeatedly, they build trust and learn from prior experiences, which will affect how they design their contractual agreements. Past research on the relationship between prior collaboration and contracts however has yielded inconsistent findings, not at least because scholars often use prior collaboration as a proxy for both learning and trust. We address these apparent contradictions by theoretically and empirically distinguishing learning from trust. In doing so, we are able to show that they have unique effects on contractual complexity. We moreover show that the effect of learning and trust on contractual complexity is contingent on relationship age, i.e., how long both partners have been working together. We test our hypotheses using a unique data set of 88 buyer-supplier relationships in the German Automotive industry. A major strength of our data is the objective measure for contracts, which relies on independent expert coding of the actual contracts negotiated between each of the buyer-supplier dyads. Findings from standard OLS regression with firm-fixed effects are largely supportive of our theory.

Co-authors: Martina Lütkewitte, Thomas Mellewigt & Ranjay Gulati