Earlier Trust and Later Trust in Sino-Joint Ventures:(a study of seven IJVs in the Pearl River Delta economic zone)

Abstract

It is suggested that trust is fundamental in working relationships and in international joint ventures(IJVs) there is a need to trust partners. Yet the nature of the IJVs does not remain fixed forever, so it was decided to explore if and how trust between partners altered over time. This is an exploratory research, in order to find out whether there is a need to go further and broader. The research explores Sino-joint ventures (equity and co-operative JVs), located in the Pearl River Delta Economic Zone, which is close to Hong Kong in Southwest China, a region which has seen intense commercial growth over the past two decades. It was expected that there would be a few JVs willing to join this research that fitted the criteria (being a equity or co-operative joint venture, and having an IJV relationship for some years longer than four years). The dateline of four years represented the boundary from ‘just beginning’ to ‘more mature’ and it was felt that the nature of trust(earlier trust and later trust that are described and defined later) between partners might change as they passed this arbitrary dateline. The thesis gives details of the research methodology and all assertions: here | will simply state that trust (earlier and later trust) in the target population of the IJVs does indeed change over time. Earlier trust is found to increase through the first four years in the young IJVs, but after the dateline has passed, later trust decreases in the mature IJVs. That earlier trust increases is in accord with theoretical expectations, and in practice it is needed for the progress of the IJVs. It was not expected from theory that later trust decreased as was found. But the lowering of later trust as the IJVs move to the mature time zone must be worrying for the IJVs directors and managers. The researcher suggests ways in which this situation may be improved. Naturally these findings require further elaboration by more researchers by extending the scope of the research further, But for the moment the analyses yield important findings that add to the literature, to the practice of international joint ventures in China, and possibly the IJVs globally.