The Effects and Multilayerdness of Inter-Organizational and Institutional Trust in Key Partnerships

Abstract

Based on an empirical study of 246 key partnerships of new social enterprises (NSEs), we examine the impact of inter-organizational and institutional trust on resource acquisition and performance outcomes. Our findings show that different dimensions of inter-organizational trust (ability-based, benevolence-based, and integrity-based) complement one another in fostering the acquisition of knowledge, reputation and financial resources resulting in social growth and innovation. Moreover, our findings indicate that the institutional embeddedness of NSEs in highly reputed entrepreneurial networks diminishes the importance of trusted key partnerships, suggesting that institutional trust substitutes for inter-organizational forms of trust. Together, this study provides insights into the multilayeredness of inter-organizational and institutional trust by uncovering their complementary and substitution effects in affecting resource acquisition and performance outcomes.