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Journal of the Academy of Marketing Science

, Volume 47, Issue 6, pp 1064–1084 | Cite as

Network embeddedness as a dependence-balancing mechanism in developing markets: differential effects for channel partners with asymmetric dependencies

  • Maggie Chuoyan Dong
  • Fue ZengEmail author
  • Chenting Su
Original Empirical Research

Abstract

Channel relationships with dependence asymmetry, which are especially harmful to partners with dependence disadvantage, abound in developing markets. To help these dependence-disadvantaged parties find feasible solutions for dependence balancing, this study examines network embeddedness and its differential role in enforcing the counterpart’s relationship-specific investments (RSIs), thus leading to improved channel performance for both partners. Based on the political economy framework, we posit that a dependence-disadvantaged partner’s embeddedness in business and government networks entices its partner to commit more RSIs, which in turn improve its channel performance; conversely, such an effect is weaker for the dependence-advantaged partner. We also predict that under high dependence asymmetry, a dependence-disadvantaged partner’s embeddedness in the business network will exert a smaller effect, but its embeddedness in the government network will exert a larger effect. We collected dyadic survey data of buyer–supplier pairs in consumer product industries in China. In general, the results provide support for our predictions. The findings provide theoretical and managerial implications for partners in asymmetric channel relationships in developing markets.

Keywords

Channel relationships Dependence asymmetry Network embeddedness 

Notes

Acknowledgements

The authors gratefully acknowledge the insightful comments from the guest editors and the three anonymous reviewers. They also thank Christine Moorman, Constantine S. Katsikeas, and other participants at the JAMS Thought Leaders’ conference 2017 for their helpful comments. The research was supported by the Key Programs of National Natural Science of China (Grant No.71832010 and 71532011), the General Programs of National Natural Science of China (Grand No.91646121,71802174 and 71372129) and the General Research Fund from the Research Grants Council of Hong Kong (Project No. CityU 1506415 and 9042146).

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© Academy of Marketing Science 2018

Authors and Affiliations

  1. 1.Department of MarketingCity University of Hong KongKowloon TongHong Kong
  2. 2.Marketing Department, Economics and Management SchoolWuhan UniversityWuhanChina

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