Hostname: page-component-586b7cd67f-t7fkt Total loading time: 0 Render date: 2024-11-24T15:22:50.176Z Has data issue: false hasContentIssue false
  • English
  • Français

The Ethical Limits of Trust in Business Relations

Published online by Cambridge University Press:  23 January 2015

Bryan W. Husted
Get access Rights & Permissions [Opens in a new window]

Abstract:

This article defines and analyzes the nature of a trust relation. It specifically examines the internal and external morality of trust relations and the ethical limits of those relations. It examines both the ends pursued by trust relations as well as the means by which trust is developed. It shows that the ends need to be evaluated by traditional ethical theories, while the ethical constraints of the trust process depend upon the specific bases of trust. In addition, the consequences of the trust process differ in their impact on the trustor and third parties. Despite the popularity of trust in the literature, this study recommends caution in the use of trust as an ethical basis for economic organization. The optimal form of trust, although still subject to limitations, is fairness-based trust.

Type
Articles
Information
Business Ethics Quarterly , Volume 8 , Issue 2 , April 1998 , pp. 233 - 248
Copyright
Copyright © Society for Business Ethics 1998

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Adams, J. S. 1965. Inequity in social exchange. In Berkowitz, L. (ed.), Advances in experimental social psychology, 2: 267–299. New York: Academic Press.Google Scholar
Axelrod, Robert. 1984. The evolution of cooperation. New York: Basic Books.Google Scholar
Baier, Annette. 1986. Trust and antitrust. Ethics, 96: 231–260.Google Scholar
Barber, Bernard. 1983. The logic and limits of trust. New Brunswick, NJ: Rutgers University Press.Google Scholar
Barnard, Chester. 1938. The functions of the executive. Cambridge: Harvard University Press.Google Scholar
Barney, Jay B. and Hansen, Mark H. 1994. Trustworthiness as a source of competitive advantage. Strategic Management Journal, 15: 175–190.Google Scholar
Boisot, Max and Child, John. 1988. The iron law of fiefs: Bureaucratic failure and the problem of governance in the Chinese economic reforms. Administrative Science Quarterly, 33: 507–527.Google Scholar
Brasch, John J. 1973. Trade credit and personalismo in Latin America. Journal of International Business Studies, 4: 31–41.Google Scholar
Brockner, Joel and Siegel, Phyllis. 1996. Understanding the interaction between procedural and distributive justice: The role of trust. In Kramer, Roderick M. and Tyler, Tom R. (eds.), Trust in organizations: Frontiers of theory and research (pp. 390–413). Thousand, Oaks, CA: Sage Publications.CrossRefGoogle Scholar
Dore, Ronald. 1983. Goodwill and the spirit of market capitalism. British Journal of Sociology, 34 (December): 459–82.Google Scholar
Ehrlich, Eugen. 1962. Fundamental principles of the sociology of law. New York: Russell and Russell, Inc. (first published in 1913).Google Scholar
Fairholm, Gilbert W. 1994. Leadership and the culture of trust. Praeger Publishing.Google Scholar
Ferguson, Kathy E. 1984. The feminist case against bureaucracy. Philadelphia: Temple University Press.Google Scholar
Fort, Timothy L. 1996. Business as mediating institution. Business Ethics Quarterly, 6(2): 149–163.Google Scholar
Fuller, Lon L. 1969. The morality of law. 2nd ed. New Haven, CT: Yale University Press.Google Scholar
Gambetta, Diego (ed.). 1988. Trust: Making and breaking cooperative relations. Oxford, UK: Basil Blackwell.Google Scholar
Held, Virginia. 1984. Rights and goods: Justifying social action. New York and London: Free Press.Google Scholar
Hooper, John. 1995. The new Spaniards. London: Penguin.Google Scholar
Hosmer, LaRue Tone. 1994. Why be moral? A different rationale for managers. Business Ethics Quarterly, 4(2): 191–204.Google Scholar
Hosmer, LaRue Tone. 1995. Trust: The connecting link between organizational theory and philosophical ethics. Academy of Management Review, 20(2): 379–403.Google Scholar
Howell, Jane M. and Avolio, Bruce J. 1992. The ethics of charismatic leadership: Submission or liberation. The Executive, VI (2, May): 43–54.Google Scholar
Husted, Bryan W. 1994. Honor among thieves: A transaction-cost approach to corruption in third-world countries. Business Ethics Quarterly, 4(1):17–27.Google Scholar
Ishikawa, Kaoru. 1991. What is total quality control?: The Japanese way. Englewood Cliffs, NJ: Prentice Hall.Google Scholar
Jackall, Robert. 1988. Moral mazes: The world of corporate managers. New York: Oxford University Press.Google Scholar
Jones, Thomas M. 1995. Instrumental stakeholder theory: A synthesis of ethics and economics. Academy of Management Review, 20(2): 404–437.Google Scholar
Kanter, Rosabeth Moss. 1977. Men and women of the corporation. New York: Basic Books.Google Scholar
Keeley, Michael. 1995. The trouble with transformational leadership. Business Ethics Quarterly, 5(1): 67–96.Google Scholar
Koehn, Daryl. 1996. Should we trust in trust? American Business Law Journal, 34(2): 184–203.Google Scholar
Landa, Janet Tai. 1994. Trust, ethnicity, and identity: Beyond the New Institutional Economics of ethnic trading networks, contract law, and gift-exchange. Ann Arbor, MI: University of Michigan Press.Google Scholar
Landau, Martin. 1974. Political theory and political science: Studies in the methodology of political inquiry. New Jersey: Humanities Press.Google Scholar
Lindsley, Dana H., Brass, Daniel J., and Thomas, James B. 1995. Efficacy-performance spirals: A multilevel perspective. Academy of Management Review, 20(3): 645–678.Google Scholar
Macneil, Ian R. 1974. The many futures of contracts. Southern California Law Review, 47: 691–816.Google Scholar
Macneil, Ian R. 1983. Values in contract: Internal and External. Northwestern University Law Review, 78: 340–418.Google Scholar
Macneil, Ian R. 1984–85. Bureaucracy, liberalism, and community—American style. North-western University Law Review, 79: 900–948.Google Scholar
Maine, Sir Henry. 1906. Ancient law: Its connection with the early history of society and its relation to modern ideas. London: J. Murray. First published in 1864.Google Scholar
Mayer, Roger C., Davis, James H. and Schoorman, F. David. 1995. An integrative model of organizational trust. Academy of Management Review, 20(3): 709–734.Google Scholar
Mayfly, Brian. 1996. Utah charges with theft, fraud involving $439,000. Salt Lake Tribune, October, 27.Google Scholar
Miller, Danny. 1993. The architecture of simplicity. Academy of Management Review, 18: 116–38.Google Scholar
Ouchi, William G. 1980. Markets, bureaucracies, and clans. Administrative Science Quarterly, 25: 129–141.Google Scholar
Polanyi, Michael. 1962. Personal knowledge: Towards a post-critical philosophy. Chicago: University of Chicago Press.Google Scholar
Polanyi, Michael. 1966. The tacit dimension. Garden City, NY: Anchor Books.Google Scholar
Raphael, D. D. 1981. Moral philosophy. Oxford U.K.: Oxford University Press.Google Scholar
Ring, Peter M. and de Ven, Andrew, Van. 1992. Structuring cooperative relationships between organizations. Strategic Management Journal, 13: 483–498.Google Scholar
Scott, William G. and Hart, David K. 1979. Organizational America. Boston, MA: Houghton Mifflin Company.Google Scholar
Shapiro, Susan. 1987. The social control of impersonal trust. American Journal of Sociology, 93: 623–58.Google Scholar
Shaw, Robert Bruce. 1997. Trust in the Balance. San Francisco, CA: Jossey-Bass Publishers.Google Scholar
Sheppard, Blair H., Lewicki, Roy J., and Minton, John W. 1992. Organizational justice: The search for fairness in the workplace. New York: Lexington Books.Google Scholar
Sheppard, Blair H. and Tuchinsky, Marla. 1996. Micro-OB and the network organization. In Kramer, Roderick M. and Tyler, Tom R. (eds.), Trust in organizations: Frontiers of theory and research (pp. 140–165). Thousand Oaks, CA: Sage Publications.Google Scholar
Sonnenberg, Frank K. 1996. Managing with a conscience: How to improve performance through integrity, trust, and commitment. New York: McGraw-Hill.Google Scholar
Thibaut, J. W. and Walker, L. 1978. A theory of procedure. California Law Review, 66: 541–566.Google Scholar
Tonnies, Ferdinand. 1957. Community and society. East Lansing, MI: Michigan State University Press (first published in 1887).Google Scholar
Vaughan, Diane. 1982. Transaction systems and unlawful organizational behavior. Social Problems, 29(4): 373–379.CrossRefGoogle Scholar
Weber, Max. 1946. Bureaucracy. In Gerth, H. H. and Mills, C. Wright (eds.), From Max Weber: Essays in sociology (pp. 196–244). New York: Oxford University Press.Google Scholar
Whitney, John O. 1995. The economics of trust: liberating profits and restoring corporate confidence. New York: McGraw-Hill.Google Scholar
Williamson, Oliver E. 1993. Calculativeness, trust, and economic organization. Journal of Law and Economics, 36: 453–486.Google Scholar
Zand, Dale E. 1972. Trust and managerial problem solving. Administrative Science Quarterly, 17(2): 229–239.Google Scholar
Zucker, Lynne G. 1986. Production of trust: Institutional sources of economic structure, 1840–1920. In Staw, B. M. and Cummings, L. L. (eds.), Research in organizational behavior (Vol. 8, pp. 53–111). Greenwich, CT: JAI Press.Google Scholar
Zucker, Lynne G., Darby, Michael R., Brewer, Marilynn B., and Yusheng, Peng. 1996. Collaboration structure and information dilemmas in biotechnology: Organizational boundaries as trust production. In Kramer, Roderick M. and Tyler, Tom R. (eds.), Trust in organizations: Frontiers of theory and research (pp. 90–113). Thousand Oaks, CA: Sage Publications.Google Scholar