Trust in Transitional Market: Towards a dynamic and contextualised understanding of trust development in Chinese marketing channel relationship

This thesis aims to understand how trust development between business actors of marketing channel relationships is influenced by the dynamic socio-economic context of Chinese transitional economy. The rationale of this thesis lies in the belief that, in the Chinese transitional economy ⎯ where socio-economic conditions change over time ⎯ the recognition and comprehension of the nexus between trust development and socio-economic context can make all the difference to academic and practical understanding of why trust is successfully developed and sustained under certain socio-economic conditions of transitional economy, whilst being disrupted or broken under other conditions.

This thesis transcends the conventional business-to-business marketing idea that trust is merely a static psychological belief. Instead, it views trust as a reflexive developing process that constitutes the cognitive, emotive and behavioural aspects of social experiences and situates trust development into business actors’ interaction experiences. The thesis also adopts the notion of embeddedness to examine how cultural, cognitive, social, and political conditions of Chinese transitional economy (re)shape economic actions and mentalities.

The thesis develops a qualitative research design that combines a series of semi-structured interviews and participant observations. The empirical data confirms that business actors refer to their knowledge of socio-economic conditions when forming up the cognition, emotion and actions in their business interactions. As a result, the trust-developing process varies when business actors’ social knowledge evolves in concordance with the changing socio-economic conditions.

The thesis also provides evidence that the constant struggle of power between free market and authoritarian government is the source of disruption to trust development in the Chinese transitional economy. Three mechanisms are found to offset the disruption: strong obligations to social norms; business-state ties; and obligations to formal control mechanisms. These mechanisms provide business actors with relatively stable reference systems that can be used to govern business interactions.