Geography Reference
In-Depth Information
and cooperate in providing a wide range of services to the i nal consumer. Finally, in the
i fth section, by using the described theoretical and empirical issues, some conclusions
are drawn.
2. Trust and reputation: an integrated and evolutionary perspective
The impact of social capital on district dynamics and local network structure has been
considered in a large number of studies (Cioccarelli, 2003; Elangovan and Shapiro, 1998;
Granovetter, 1985; Gulati, 1995; Nahapiet and Goshal, 1998; Nooteboom et al., 1995).
In order to evaluate the impact of social capital - with a special emphasis on the issues
of trust and reputation - on i rm variety within districts, according to an evolutionary
geography perspective, two research steps are necessary. First of all, the ef ective recipro-
cal inl uence between social assets, such as trust, and intangible i rm-specii c resources,
such as reputation, must be coni rmed. Moreover, in this attempt, it is also important to
verify if network structure plays a role as a sort of 'mediator' between pure externalities
available to all i rms and resources absorbed by dif erent local agents. Network relation-
ships inl uence perceptions, information distribution and, above all, the ef ective access
to knowledge externalities (Gulati, 1999). Then, as a second research step, it is important
to understand 'how' - in a longitudinal perspective - social capital, at the network level,
shapes social resources at the i rm level, selecting the best know-how and increasing
heterogeneity. This chapter focuses on the i rst of the above mentioned research steps
- analysis of the correlation between network- and i rm-specii c social heterogeneity -
as a fundamental precondition in order to approach later the evolutionary side of the
problem.
Trust and reputation can mitigate information asymmetry by reducing transaction-
specii c risks (Xiong and Liu, 2003) and coordination costs (Granovetter, 1985; Perrone,
2001), strengthening the relationships, increasing the ef ectiveness of network structure
and empowering the ability of local i rms to explore and exploit location-specii c assets.
On the other hand, trust and reputation reinforce the consolidation of organizational
routines (Nelson and Winter, 1982; Winter, 2002) increasing their uniqueness and
inimitability, while geographic proximity facilitates the development of informal inter-
organizational patterns of interactions (Denicolai and Zucchella, 2005).
In order to analyse social capital at the 'meso-level' - district/network relationships -
we consider the construct of trust. This issue has been of growing interest in the econom-
ics literature in the last decade, opening a lively debate about this concept, its relevance
for economic analysis and its theoretical modelling (Gambetta, 1998; Gulati, 1995;
Nooteboom, 2002; Ring and Van de Ven, 1994). These studies have proposed dif erent
perspectives of analysis and have generated dif erent operationalizations.. The dei nition
of trust adopted in this contribution is the following:
the belief that an individual or group makes good-faith ef orts to behave in accordance with
any commitments both explicit and implicit, is honest in whatever negotiations preceded such
commitment, and does not take excessive advantage of another even when the opportunity is
available. (Cummings and Bromiley, 1996, p. 303)
The analysis of this dei nition shows that the object of this informal agreement or
the nature of this expectation can be dif erentiated. Many authors emphasize the com-
plexity of trust issues and draw a distinction between dif erent forms (Barber, 1983;
