Abstract
Acquiring local knowledge from host-country key partners is crucial for internationalizing firms, yet it entails severe risks for both partners. Research thus emphasizes the role of interorganizational trust, but is inconclusive about how effective it is in different contexts. We theorize how different trust dimensions interact with host-country legal safeguards. We test our hypotheses with data on 210 cross-border relationships in the renewable-energy industry. Results show that weak legal safeguards render ability-based trust particularly effective for knowledge acquisition, while strong legal safeguards render integrity-based trust effective. Benevolence-based trust, however, may have detrimental effects under conditions of strong legal safeguards.
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