The Performance of Seaport Clusters - RePub - Erasmus Universiteit ...

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The Performance of Seaport Clusters
and changes through learning. Therefore trust does not have to be blind but whether it is
rational or not to trust potential exchange partners depends on the (cluster) environment.
In cluster where the level of trust is high, the scope of coordination beyond price is larger
than in ‘low-trust clusters’, because uncertainty is reduced and the threat of opportunistic
behavior is lower.
The level of trust in a cluster is influenced by the importance of reputation effects in a
cluster. If reputation effects are strong, abusing trust has negative effects and therefore it is
worthwhile for firms to build a trustworthy reputation. Because of this, the culture of trust is
sustainable. This reputation effect has both an economic and a social aspect: firms strive for
a good reputation because it yields positive returns, managers strive for a good reputation
because it yields personal career opportunities.
Thus, in clusters where the reputation effect is strong, the likeliness that one can trust a
potential exchange partner, even when such a partner has an opportunity and an incentive
to damage one’s interests (this is Nooteboom’s (1996) definition of intentional trust) is high.
In such ‘high trust clusters’, transaction costs are relatively low.
6.3 Intermediaries
The presence or absence of intermediaries also influences the quality of coordination in the
cluster. Intermediaries reduce coordination costs and expand the ‘scope of coordination
beyond price’. Three reasons substantiate the positive effect of intermediaries 38 . First, they
provide a ‘bridging tie’ (McEvily and Zaheer, 1999) between two or more otherwise not
connected exchange partners. Intermediaries lower search costs for firms looking for
exchange partners, and literally ‘bridge’ gaps between potential exchange partners. Second,
intermediaries reduce coordination costs because they ‘connect cognitions’. Firms operate
in specific markets and develop both capabilities and a cognition matching their market
environment. Intermediaries reduce transaction costs because they can bridge cognitive
differences between firms that operate in very different market environments. This role of
connecting cognitions is especially important in clusters given the fact that clusters are
characterized by a ‘cognitive division of labor’ (Belussi and Gottardi, 2000).