¹Department of Management, University of Miami, Coral Gables, FL, USA

Correspondence: Y Luo, Department of Management, School of Business Administration, University of Miami, 417 Jenkins Building, Coral Gables, FL 33124-9145, USA. Tel: +1 305 284 4003; Fax: +1 305 284 3655; E-mail: yadong@miami.edu

Received 8 September 2004; Revised 21 April 2006; Accepted 26 March 2007; Published online 19 July 2007.

Abstract

Building on economic and social exchange theories, this study develops an integrated model in which curtailing opportunism in international joint ventures (IJVs) requires four interrelated sets of suppressing forces: (1) contractual ordering (contractual inclusiveness and contractual obligatoriness); (2) structural ordering (managerial governance and equity captiveness); (3) relational ordering (interparty attachment and boundary-spanner ties); and (4) justice ordering (procedural justice and distributive justice). Using a sample of 192 IJVs in an emerging market, this study finds general support for our theoretical model. Our research validates that countering opportunism involves a system-wide effort that integrates economic and social mandates, unifies ex ante and ex post mechanisms, controls both egoistic and non-egoistic motivations, and combines organizational-level and individual-level forces. For partners from individualist cultures, economic ordering forces (contractual and structural) are stronger than social ordering forces (relational and justice) in relation to opportunism resistance, whereas for partners from a collectivistic culture, social ordering forces are relatively stronger than economic ordering forces for this end.