Abstract
Although the role of justice has long been documented in organizational contexts, little is known about the relative effects of distinct types of justice in inter-organizational relationships. Building on transaction cost theory (TCT), our research investigates how procedural justice and distributive justice affect alliance success differentially and under what conditions these effects are amplified or weakened. Results derived from a sample of 410 Chinese alliance firms involving two key informants per firm suggest that procedural justice has a greater influence on alliance success than distributive justice and that such a comparative effect varies across types of trust and conflict. Specifically, when alliance firms share a high level of goodwill trust or constructive conflict, they rely to a greater extent on procedural justice than on distributive justice to achieve alliance success. In contrast, when there is a high level of constructive conflict, alliance firms depend more heavily on distributive justice than on procedural justice to achieve success. Our study extends TCT to explain how, in the context of Chinese culture, firms employ appropriate tools of justice in ongoing alliances.
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This paper was supported by the National Natural Science Foundation of China (72272121; 71872147) and the Soft Science Research Project of Shaanxi Province (2019KRM013).
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Managerial relevance statement
Our research examines the effects of procedural justice and distributive justice on alliance success in a comparative contingent framework in the context in which Chinese firms form alliances. This examination offers alliance managers useful insights into how they can employ tools of justice appropriately by testing which type of justice is superior to the other and under what conditions one type of justice plays a more important role than the other one does. Managers are cautioned against taking on the risk involved in recognizing the varied comparative effects of justice types without considering an important fact, namely that trust and conflict vary by type, and differences between those types may influence the effectiveness of justice as a governance tool driving alliance success. Instead, managers should assess their ongoing relationships by considering these relational factors as contingencies. In particular, they should consider the atmosphere surrounding a collaboration when utilizing alliance justice.
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Che, M., Jiang, X. & Pei, YL. When does justice drive alliance success? Direct and moderating effects based on transaction cost theory. Asia Pac J Manag (2023). https://doi.org/10.1007/s10490-023-09898-1
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DOI: https://doi.org/10.1007/s10490-023-09898-1