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Institutional trust in organization: concept, structural dimension and measurement

QI Yujue;YANG Dongtao;HE Yumei

Business Management Journal,Vol 40,No. 02

【Abstract】 The main purpose of this article is to develop a measurement scale of institutional trust. As the transaction scale and scope are concerned, institutional trust is far more important than interpersonal trust (Baek and Jung, 2015). However, little attention has been paid to institutional trust compared to interpersonal trust in the field of management research, with less research and findings on it. Furthermore, there exist some unsolved problems such as confusion of several similar concepts, vagueness of operational definition and structure dimension in theory, and lack of proper measurement scale in empirical research. Based on the relatively rich and mature research of institutional and trust theories, a deductive method is used in this article to generate the items of measurement. Firstly, institutional trust is defined operationally as trustworthiness of system, through the comparative analysis on several confusing concepts, namely, institutional trust, institution-based trust, organizational trust, system trust and impersonal trust. Secondly, institutional trust is divided into two dimensions from the perspective of functions of system, through the comparative analysis of the two different perspectives of content and function in previous research. The dimension of legitimacy refers to the definition and function of system, that is, whether the nature and objective of system can be recognized and accepted by members. The dimension of effectiveness refers to the demonstration of function, that is, whether an organizational system can be effectively implemented. The definition and dimensions are then used as a guide for the development of items, followed by experts’ guidance and revision, and doctoral candidates’ classification to evaluate the content validity. The scale development process is strictly followed by the stages and steps summarized by Hinkin (1995; 1997; 1998). After confirmation of the items, the structure, reliability and validity of the scale are examined by sample data from dozens of manufacturing enterprises. The results of exploratory factor analysis show that, all the items are correlated with each other significantly, and two common factors extracted can explain most of the variance. The dimensional division is supported by the factor structure, with respectively desirable factor loading of each item. The results of confirmatory factor analysis show that, the dimensional division is also supported by acceptable fit indexes between theoretical models and sample data, with relatively high factor loading value of each item on their respective dimensions. The results of reliability analysis and validity analysis indicate that there is high internal consistency between the items of the scale and those on both dimensions, and the measurement scale has good convergent, discriminant and criterion validities. The main theoretical contributions of this article include the following. (1) Through the differentiation and analysis of several confusing concepts, the definition and connotation of institutional trust are clarified, based on the institutional and trust theories. (2) Previous research is lack of consistent dimensional division of institutional trust. According to the perspective of Luhmann (2005) and Williamson (2001), the trustworthiness of system is judged by the evaluation about its function and the demonstration of the function. So this article divides institutional trust into two dimensions, the legitimacy dimension due to members’ acceptance and support, and the effectiveness dimension due to the performance of implementation. Thus, the structural dimension of institutional trust is divided more clearly and reasonably. (3) The existing methods of measurement universally deviate from the analysis foundation of institutional theory, while the study of system values theory more than measurement. This article provides a valid measurement tool for empirical research on institutional trust.

The impact of initiators’ characteristics on crowdfunding performance of agricultural projects: an analysis based on the trust theory

DU Junjuan;LI Yaokuang

Chinese Rural Economy,No. 03

【Abstract】 This paper collected 1166 projects derived from China’s largest E-business platform of Taobao crowdfunding and investigated initiators’ characteristics that could affect the perceived trust of investors. Based on the trust theory, the study established a research model in two dimensions, namely, a trust source and a trust transfer mechanism. With a multivariate regression method, the paper conducts an empirical analysis on the impact of initiators’ characteristics on crowdfunding performance of agricultural projects. The results indicated that industrial consistency, top-seller certification, cash deposit, credit score, the favorable feedback rate and the rural per capita net income had significantly positive impacts on the funding performance. However, factors such as the type of Alipay certification and the number of crowdfunding platforms had no significant impact on the funding performance. The study concludes by presenting implications for practice from the perspectives of initiators, crowdfunding platforms and the government.

Is trust certain to be welcome? The two paths of feeling trusted and its sequels

WANG Hong-li

Business Management Journal,Vol 40,No. 06

【Abstract】 Trust has been considered as a positive experience in the existing studies. The best respect for employees in organizations is trust in them, and the best strategy for organizations to make employees undertake responsibility is to let them feel trusted by organizations and managers. In theoretical research, it has been found that giving employees trust is the key to making employees aware of their own value, for trust can significantly stimulate employees’ self-evaluation, organizational citizenship behavior and individual performance. That is, gaining trust is a huge driving force for employees, and this is also consistent with the philosophy that “trust is a virtue and respect.” According to the Gallup survey in 2005, employees’ need to be trusted and respected in their organizations is stronger than work-related stress. Therefore, the variable “feeling trusted” is selected from previous studies emphasizing trust, becoming an important antecedent factor of behavior promotion. However, is “feeling trusted” must a happy thing? Although feeling trusted is regarded to be merely related to the individual perceptions of employees in general, it is actually the process in which the disadvantaged party interprets trust from a strong party (superior), which not only releases the signal of value, but also indicates the relationship between supervisors and subordinates. Tyler et al. (2003) pointed out that the most important value of trust was its symbol of identity and status, and it could meet the basic social needs of people. Based on the social exchange theory of Blau et al. (1964), because the resources people possess are unequal in social exchange, when social exchanges between the two sides with a larger social status gap are conducted, the disadvantaged party will choose to respect and obey the strong party or adopt other ways to repay the latter. In order to gain benefits, those who are in a disadvantaged position will be in a vassal status, leading to an involuntary social exchange. To conclude, in this asymmetric power relationship, trust creates a strong sense of subordinates to repay. Even such behavior is unintentional, it can maintain the image of being trusted by their supervisors. Meanwhile, employees’ repaying for being trusted is not only related to their understanding of feeling trusted, but also constrained by the reciprocal norm strength of organizational environment in which they are in. The former makes employees have different attitudes towards the sense of obligation to repay, while the latter strengthens the employees’ belief in the sense of such an obligation. When subordinates perceived trust from their supervisors, they will feel happy and appreciated. However, such trust will be considered unwelcome when it is delivered through delegation of important tasks. Accordingly, when subordinates feel happy, they will positively contribute to organizations, such as increasing organizational citizenship behavior. Meanwhile, when subordinates feel pressure when receiving the trust from supervisors, they will negatively contribute to organizations, such as having forced organization citizenship behavior, in particular, compulsory organizational citizenship behavior. Thus, we guess subordinates’ feeling trusted will incur two different results at the same time. In fact, giving trust to employees is the best way to help employees realize their value. In our study, 351 employees were investigated through three-round data collection. Our findings show that the following. (1) Organization-based self-esteem plays a mediating role between feeling trusted and organizational citizenship behavior. Job stress plays a mediating role in the relationship between feeling trusted and compulsory organizational citizenship behavior. (2) Norm strength has a moderating effect between the mediating and outcome variables. That is, the more an organization emphasizes reciprocal norms, the more the organization-based self-esteem is related to organizational citizenship behavior. Similarly, the more an organization emphasizes reciprocal norms, the more job stress is related to compulsory organizational citizenship behavior. The research results reveal the impact of feeling trusted on employees’ organizational citizenship behavior and compulsory organizational citizenship behavior, and its two different paths. Thus, people can truly understand “why social exchange will cover unwanted exchange behavior.” And the study further explains the reason why employees have the same perception of trust from supervisors but different ways of responding to such a perception.

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