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Impersonal Trust in B2B Electronic Commerce: A Process View 241
the absence of salespeople makes trust based on the salesperson’s expertise,
likeability and similarity mostly unavailable. Therefore, an impersonal type of trust
may be more appropriate in B2B eCommerce. There is an urgent need to go
beyond traditional dyadic relationships and examine a larger context of buyersupplier
relations in B2B eCommerce. When an increasingly large number of firms
conduct business with many new, even anonymous partners, the need to understand
the concept of impersonal trust in B2B eCommerce becomes fundamental.
Trust is important in impersonal exchange relationships, especially where
information asymmetry and uncertainty may give rise to opportunism (Akerloff,
1970), which usually leads to mistrust, agency risks and high transaction costs. B2B
eCommerce takes place in an uncertain environment that allows substantial
information asymmetry between firms. Opportunism creates the problems of
adverse selection and moral hazard, which are described in agency theory (Jensen
and Meckling, 1976). Adverse selection occurs when firms may be motivated to
misrepresent their respective abilities to the other trading firm. Moral hazard occurs
when firms do no put forth the level of effort agreed upon, or fail to complete the
requirements of an agreement (Mishra et al., 1998). The problems of adverse
selection and moral hazard could result in excessive risk associated with online
transactions, eroding the foundations of B2B eCommerce, and jeopardizing its
proliferation. However, according to game theory, under suitable mechanisms
opportunism does not pay off in the long run (Kandori, 1992). The institutional
structures of B2B exchanges can transform many single transactions into a
continuous sequence of relations between organizations, preventing opportunism
through cooperative signals and incentives. Drawing from agency theory and
transaction costs economics (TCE), trust may be viewed as a risk-reduction
mechanism, decreasing transaction and agency costs and providing flexible transactions
(Beccera and Gupta, 1999). B2B exchanges provide means of building
trust through a series of safeguarding mechanisms, such as accreditation, feedback,
monitoring and legal bonds. Since B2B exchanges are becoming an important
coordination mechanism for economic activity, this chapter attempts to provide a
framework to explain the process by which their mechanisms may engender
impersonal trust. Moreover, the consequences of impersonal trust in B2B
eCommerce are examined.
Despite the prolific differences between the traditional view of trust and
impersonal trust in B2B eCommerce, this chapter proposes that impersonal trust
can still complement interfirm exchange relations. The purpose of this chapter is to
provide new insights into how trust develops in the impersonal context of B2B
eCommerce by drawing on trust-building cognitive processes (Doney and Cannon,
1997). The global concept of trust is viewed as a two-dimensional construct in
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