Copenhagen Business School
Department of International Economics and Management


Abstract: Trust Beyond Trustworthiness: When Trust Matters the Most

Given such contextual elements for trust to matter the most as high uncertainty, high vulnerability, high stake of loss and failure, and high interdependence, the notion of trust as a psychological attitude is far from sufficient and we need to understand trust as a choice or decision about trust behavior. To make trust more salient, we need to understand the true nature of trust in terms of when and why trust matters the most. From this perspective, it is more imperative to define trust as the trustor’s choice or decision to engage in certain trusting behaviours above and beyond the trustor’s propensity to trust, as well as above and beyond the trustor’s expectation of the trustee’s trustworthiness. That is where we, as trust researchers, have the best opportunity to make our unique contributions, by challenging and overcoming the biased assumptions of self-interest and opportunism in neoclassic economics, especially in agency theory and transaction cost theory, by evoking the opposite perspective of shared interest and transaction value (see Li, 1998, 2008, for reviews). In particular, the transaction value perspective has the potential to serve as the underlying theory for strategic alliance and co-operation. In this sense, the notion of a ‘leap of faith’ is central to the true nature of trust, far beyond rational knowledge and emotional state. From the perspective of trust as a leap of faith, the propensity to trust, as a personality trait, is context-free and target free ‘blind trust’ (similar to one’s general emotional state) with no perceived vulnerability of the trustor’s trusting behaviour; while the expectation of trustworthiness, as a calculable assessment of the trustee’s character, is often context-free but target-specific trust (similar to one’s specific rational knowledge). The above two situations fall into the ‘comfort zone’ of the trustor without much ‘discomfort’. Both can be reframed as ‘confidence’ rather than trust. In contrast, trust-as-choice under high uncertainty, high vulnerability and high stakes will require a ‘leap of faith’ that falls outside the comfort zone into the discomfort zone of the trustor, which can be overcome by making a hard choice or decision. In this sense, trust-as-choice captures the true nature of trust in terms of a leap of faith, rather than confidence that does not require such a leap of faith.

Biographical Sketch:

Peter Ping Li (PhD, 1991, George Washington University, USA) is Professor of Chinese Business Studies at Copenhagen Business School, Denmark. Before joining CBS, he was Professor of Management at California State University. His primary research focus is on reexamining the extant Western theories from the cultural and historical frames of China and East Asia, especially applying the Chinese philosophy of wisdom to the development of holistic, dynamic and duality theories. He has been widely recognized as one of the leading scholars in two fast emerging research streams: (1) multinational firms from the emerging economies, and (2) indigenous research on the Chinese management. He has published over 30 articles in various academic journals. He is serving on the editorial boards of six major management journals, i.e., Academy of Management Discovery, Journal of Management Studies, Journal of International Management, Global Strategy Journal, Management and Organizational Review, and Asia Pacific Journal of Management. He is also the founding Editor-in-Chief of Journal of Trust Research.

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