Abstract
Previous research mainly focused on the agency-theoretical explanation of multi-unit franchising (MUF). The aim of this study is to develop a relational governance perspective of MUF by investigating the role of knowledge-based trust and general trust in franchisor's choice between multi-unit and single-unit franchising. Our data from the German franchise sector indicate that knowledge-based trust positively influences and general trust negatively influences the franchisor's tendency towards multi-unit franchising.
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