Coercive strategy in interfirm cooperation: Mediating roles of interpersonal and interorganizational trust

Coercive strategy is an influential conflict resolution technique in interfirm cooperation. This paper examines how the use of coercive strategy is affected by partner and relationship characteristics (specifically firm similarity, partner reputation, and asset specificity), and how these relationships are mediated by trust. We test our hypotheses with a cross-sectional sample of 228 cooperative relationships between architects and contractors in Hong Kong. Measures of both interpersonal and interorganizational trust are included. The findings highlight the critical role played by trust as a full mediator in the relationships of firm similarity and partner reputation with coercive strategy. Asset specificity, in contrast, has a direct and positive effect on coercive strategy that is unrelated to the level of interpersonal trust.