An Action Pattern Model of Inter‐firm Cooperation*

Abstract

An action pattern model was developed and applied to the examination of inter-firm cooperative processes. The model considered cooperation as a continuous cycle of actions and reactions between cooperating partners. The building blocks of the model include cooperative equilibrium, disruptive events, action types and action patterns. Three action pattern variables were proposed to describe the interactions. It was hypothesized that action patterns are contingent on partner relationships and the transaction cost characteristics of a partnership. The hypotheses were tested on a sample of 263 partnerships in the construction industry in Hong Kong. The quantitative study was supplemented by four in-depth case studies. The results show that: (1) trust was an important antecedent of action patterns; and (2) transaction cost variables moderate the relationships between partner relationships and action patterns. These findings suggest that future research should give more attention to the interaction of partners during cooperation.

The Variety of Governance Structures Beyond Market and Hierarchy

“…It comprises a great variety of governance structures and has long experience with different forms of governance (Eccles, 1981;González-Díaz, Arruñada & Fernández, 2000;Lui & Ngo, 2005;Winch, 2001). It is not known for its institutional and technological innovativeness and experimentation but rather follows long-standing traditions of how it organizes and manages intra-and inter-organizational construction projects.…”

“…In the context of the construction industry, Ngowi (2007) presents evidence that partner trustworthiness reduces the need for contractual safeguarding clauses. In their study in the Hong Kong construction industry, Lui and Ngo (2005) moreover find that trust enhances supplier acquiescence, i.e. suppliers are more inclined to follow the requests and actions of the buyer even at the expense of their own short-term interests.…”

Divided Loyalists or Conditional Cooperators? Creating Consensus About Cooperation in Multiple Simultaneous Social Dilemmas

“…Whereas previous research examines how process, as well as structural, elements affect satisfaction with partners when cooperating (Lui & Ngo, 2005) the current paper examines how changes in group structure (same versus different groups) affect the cooperation processes individuals use to achieve collective action.…”

Enhancing Relationship Quality: The Case of Franchises

“…Though superficially obedient, the inferior party will protect its interests (Lui and Ngo, 2005). With interdependence, power is balanced, fostering an equal exchange relationship without negative feelings in which the two parties can purse mutual long-term benefits.…”

“…Out of cost concerns, given high proprietary assets, franchisees will be less likely to adopt opportunistic behavior. Therefore, franchisees' idiosyncratic investments will inhibit their opportunistic behavior (Lui and Ngo, 2005). Williamson (1985) suggested that proprietary assets can modify firms' selfish motives and stabilize cooperation.…”