Building Trust in Economic Space

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Building Trust in Economic Space

James T. Murphy Prog Hum Geogr 2006 30: 427 DOI: 10.1191/0309132506ph617oa The online version of this article can be found at: http://phg.sagepub.com/content/30/4/427
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Progress in Human Geography 30, 4 (2006) pp. 427450
Building trust in economic space

James T . Murphy*
Graduate School of Geography, Clark University, 950 Main Street, Worcester, MA 01610-1477, USA
Abstract: While there is widespread recognition of the importance and role of trust in facilitating regional development, technology transfer, and agglomeration economies, the concept remains rather undertheorized within economic geography and regional science. This paper reviews and assesses the literature on the role and constitution of trust for economic and industrial development and presents a conceptualization of the trust building process that accounts for the inuences of agency, institutions, materials, and interpersonal expression. In doing so, geographic concerns about the role of space and context are linked to economic and sociological conceptualizations of trust and to scholarship from actor-network theory (ANT) and social psychology regarding the influence of power, non-human intermediaries, and performance on social outcomes and network congurations. The result is a heuristic framework for analyzing trust-building processes as temporally and spatially situated social phenomena shaped by contextspecific subjective, intersubjective, and structural factors. The conceptualizations broader signicance lies not in detailing the many factors that inuence trust but in its contextualization of the micro-social processes that can strengthen business relationships. In doing so, the framework can facilitate a move beyond solely instrumental conceptualizations of trust and toward a relational understanding of how the means for establishing and sustaining trust influence the development and potential of such ends as clusters and production networks. Key words: actor-network theory, economic geography, networks, power, social capital, social psychology, trust.
I Introduction Extensive scholarship in economics, economic sociology, organizational theory, and economic geography has demonstrated how the innovativeness, performance, and competitiveness of firms and industries are inuenced by social context and the ability of economic agents to develop networks and mobilize relational resources for information
acquisition, learning, and exchange relations (Granovetter, 1985; North, 1990; Burt, 1992; Putnam, 1993; Amin and Thrift, 1993; Uzzi, 1996; Storper and Salais, 1997; Cooke and Morgan, 1998; Cooke and Wills, 1999; Malecki, 2000; Helmsing, 2001; Scott, 2002; Scott and Storper, 2003). Despite the signicant contributions of this literature, geographers are still grappling with ways better to
*Email: jammurphy@clarku.edu 2006 SAGE Publications 10.1191/0309132506ph617oa
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Building trust in economic space production, innovation, and commodity networks; one that embeds and stabilizes relationships, fosters knowledge and technology diffusion, and helps to create order in the global economy. As Hess (2004) observes:
Globalization, then, is obviously not a process of disembedding based on mere market transactions and impersonal trust, but rather a process of transnational (and thereby translocal) network building or embedding, creating and maintaining personal relations of trust at various, interelated geographical scales. (Hess, 2004: 76)
theorize and empirically assess the sociospatial contexts, dynamics, and interactions that constitute learning processes, knowledge transfer systems, clusters, global production networks, and regional economies (Angel, 2002; Sheppard, 2002; Dicken, 2004; Morgan, 2005; Peck, 2005; Yeung, 2005a). The spatial characteristics and social patterns of these phenomena are well documented but there remains much to be learned about the social, economic, and spatial processes through which rms, industries, cities, and regions achieve the economies of scope or scale necessary to become successfully integrated into global markets, capital circuits, and knowledge ows. Moreover, recent conceptual developments (eg, institutional thickness, communities of practice, relational proximity, or learning regions) remain, to some, fuzzy, vague, or difcult to apply from a policy-making perspective (Markusen, 1999; Martin and Sunley, 2001; Morgan, 2005). All told, there is a need to establish more rigorous links between micro-social interactions (eg, trust-building processes), meso-level structures (eg, industrial districts or clusters), and macro-scale phenomena (eg, global markets or value chains) (Dicken et al., 2001; Bathelt and T aylor, 2002; Mackinnon et al., 2002; Oinas, 2002; Ettlinger, 2003; Bathelt et al., 2004; Dicken, 2004; Hess, 2004; Yeung, 2005a). Networks, and the associations that bind them together, are key units of analysis for research into the sociospatial dynamics of innovation, regional development, and economic globalization. As Bunnell and Coe (2001) note:
We suggest that networks, with their associated attributes of connectivity, reciprocity, embeddedness and power relations need to be brought to center stage. Tracing networks can assist in identifying the threads that both bind and link together particular clusters and nodes of activity, thereby creating different scales or territorializations of activity. (Bunnell and Coe, 2001: 578)
Trust is a key inuence on the constitution and development of economic spaces like
While there is widespread recognition of trusts importance and role in facilitating regional development, technology transfer, and agglomeration economies, it remains rather undertheorized within economic geography and regional science. Specically, the literature lacks a clear and consistent conceptual framework addressing the processes or mechanisms through which trust (or distrust) emerges in a social or economic context. Whether it facilitates productivity, learning, and innovation in rms, helps to embed or ossify particularistic kinds of business networks within or between places (eg, family, clan, or ethnic networks), is strongly established (eg, through friendship or kin relations), or is weakly ensured (eg, through goodwill or faith), trust is a fundamental characteristic of business networks, one which can signicantly inuence the transaction costs of exchange, the exibility, innovativeness, or adaptability of firms, and the quality of the information or knowledge ows available to a businessperson. As such, a detailed understanding of the relational processes that lead to or prevent trusts emergence can tell us much about how sociospatial structures like networks are actually performed and sustained by individuals and rms. Hudson (2004) recently noted that an important objective of contemporary research in economic geography should be to understand how the ows, circuits, and
James T . Murphy practices that constitute the global economy are constructed and situated in distinct times and places. In applying and extending this idea this paper argues that the study of trust broadly dened as a relational process and socially constructed phenomenon that, in part, enables structures such as networks, clusters, or commodity chains to emerge and be stabilized over time offers a conceptual lens through which we can more deeply examine and understand the dynamics of industrial change and the sociospatial characteristics, complexities, and contingencies of economic processes. As Glckler (2005: 1732) observes, trust is a fundamental precondition for many forms of social organization but one whose qualities and contributions are inadequately understood. Trusts specific role in inter-, intra-, and extrarm networks is an especially important consideration but one that has received surprisingly limited attention despite increasing interest in the relational, discursive, and communicative dimensions of economic geographies (eg, Lee and Wills, 1997; Boggs and Rantisi, 2003; Amin and Cohendet, 2004; Yeung, 2005a; 2005b). This paper addresses this concern by advancing a process-, power-, and context-sensitive conceptualization of trust, one that can improve theoretical and methodological links between the microsocial interactions that constitute economic relations and the meso-scale and macro-scale phenomena characterizing the diverse geographies of the world economy (eg, clusters, production networks, value chains, and regional economies). The objective here is not to assert that trust is essential for all economic processes but to provide a more rigorous conceptualization of the sociospatial mechanisms through which it develops and is mobilized by economic agents. The discussion that follows reviews and assesses the literature on the role and constitution of trust for economic and industrial development and presents a conceptualization of the trust-building process; one that explicitly accounts for the influences of
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agency, institutions, materials, and interpersonal expression and which seeks to contextualize the structural, cognitive, and intersubjective factors that can lead to or prevent the emergence of trust. In doing so, geographic concerns about the role of space and context are linked to economic and sociological conceptualizations of trust and to scholarship from actor-network theory (ANT) and social psychology regarding the inuence of power, non-human intermediaries, and social performance on network configurations. ANTs concern with powers derivation and practice and its attention to the role of heterogeneous materials (ie, human and nonhuman agents) in shaping the ordering of networks, make it signicant for the study of trust as a process inuenced in part by power relations and the mobilization of intermediaries such as contracts, letters of credit, and technologies as demonstrations of legitimacy or trustworthiness. The rich literature from social psychology, conceptualizing and analyzing the cognitive, emotive, performative, and structural dimensions of social encounters, draws on similar ideas but is particularly strong in systematically accounting for the inuence of individual meaning systems on social interactions and in documenting the subtleties and complexities of face-to-face communication. In bringing together seminal ideas from ANT and social psychology, as well as the extant trust literature, this paper develops and advances a conceptualization of trust as a sociospatial process enacted by agents through relations mediated by structural factors, power differentials, emotions, meaning systems, and material intermediaries. The theoretical framework seeks to shift our understanding of trust beyond static conceptualizations trust as instrument, input, or structural component of networks and toward a more dynamic or relational perspective on how collaboration occurs and where and/or why it is situated in particular places and spaces. In doing so, we can deepen our understanding of what actually constitutes a network link or a business association
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Building trust in economic space Hess, 2004). Within these and related studies, trust is often viewed as an important contributing factor to local development (Bellandi, 2001; Henry and Pinch, 2001; Bathelt and Taylor, 2002), the creation of clusters, learning regions, and institutionally thick places (Grabher, 1993; Amin and Thrift, 1993; Cooke and Morgan, 1998; Nadvi, 1999; Helmsing, 2001), the stabilization and legitimization of place identities (Hudson, 1998), the creativity, solvency, and innovativeness of rms (Banks et al., 2000; Murphy, 2002; Nijkamp, 2003; Glckler, 2005), and the historical development of commercial and business networks (Winder, 2001; Stobart, 2004). Moreover, trust facilitates the transfer of codified information, tacit forms of knowledge, and soft technologies between places and the trust-building processes used in and by rms can tell us much about how workplaces, clusters, value chains, and production networks are constructed (Ettlinger and Patton, 1996; Malecki and Tootle, 1996; Ettlinger, 2003; Gertler, 2003; Bathelt et al., 2004; Mackinnon et al., 2004).1 Beyond such instrumental assessments, geographers are increasingly viewing trust as a complex social phenomenon or process shaped by knowledge, emotions, reputation, appearance, gender identities, place-specic institutions, and power relations (Mackinnon et al., 2002; Ettlinger, 2003; Gertler, 2003; Murphy, 2003; Leyshon et al., 2004; Blake and Hanson, 2005; Glckler, 2005). Relational proximity is viewed by some as a key resource for the development of trusting relationships and is manifest in the degree to which individuals, firms, and communities are bound by relations of common interest, purpose, or passion, and held together by routines and varying degrees of mutuality (Boggs and Rantisi, 2003; Bathelt and Glckler, 2003; Amin and Cohendet, 2004: 74; Bathelt et al., 2004; Hess, 2004; Yeung, 2005a; 2005b). As such, it does not require colocation for its benets to be realized but instead is a function of the degree to which
and, consequently, improve our theorizations of sociospatial phenomena such as clusters, value chains, and learning regions. The remainder of the paper is organized into ve sections. Section II briey reviews the economic geography literature on the sociospatial dimensions of industrial change and the role of trust for regional development and innovation. Section III examines conceptualizations of trust from economics, economic sociology, and organizational theory and assesses their utility and applicability for understanding network processes. Section IV demonstrates how the actor-network theory (ANT) and social psychology literatures offer new opportunities for research into the sociospatial dimensions of trust-building and networking. Section V presents a conceptual framework that integrates ideas from the theoretical perspectives reviewed. The paper concludes in Section VI with a brief discussion on future directions for trust research and about the broader implications of the conceptual framework. II The importance of trust perspectives from economic geography and regional science Economic geographers and regional scientists have extensively examined the social and relational factors that shape industrial agglomerations and clusters, facilitate (or impede) urban and regional development, enable (or disable) information, technology, and knowledge diffusion and absorption, incubate (or discourage) entrepreneurship, and foster uneven development and spatial concentration in the global economy (Amin and Thrift, 1993; Grabher, 1993; Ettlinger and Patton, 1996; Cooke and Morgan, 1998; Storper and Salais, 1997; Amin, 1999; Malecki and Oinas, 1999; Maskell and Malmberg, 1999; Malecki, 2000; Yeung, 2000; Dicken and Malmberg, 2001; Henry and Pinch, 2001; Bathelt and Taylor, 2002; Mackinnon et al., 2002; Oinas, 2002; Murphy, 2002; Scott, 2002; Nijkamp, 2003; Scott and Storper, 2003; Bathelt et al., 2004;
James T . Murphy individuals or rms are embedded within a common socio-economic context (eg, in networks, a society, or both) and whether there is an implicit and mutual understanding of the roles, expectations, and norms for conducting business together (Hess, 2004). In essence, an agents ability to foster relational proximity with another can be viewed as an important rst step toward the development of trusting business ties as it is indicative of ones knowledge, legitimacy, or credibility in the context of a business interaction. Despite this recent turn, toward the softer dimensions of networks and business relations, some are skeptical about trusts conceptual and empirical utility and about the ways in which geographers are applying it to studies of innovation and regional development. Morgan (2005) expresses concerns about what he sees as an exaggerated emphasis on relational proximity as a factor shaping learning and innovation and stresses the importance of physical distance and geographical proximity for such processes. Mohan and Mohan (2002) question the replicability and cost-effectiveness of studies aimed at spatially disaggregating components of social capital such as trust. Instead, they suggest that scholars focus on more generalizable and comparable (temporally and crossregionally) forms of association (eg, participation rates in civic organizations). Gertler (2003) challenges conventional understandings of the role of trust in tacit-knowledge transfer and suggests that there is a need to better understand trusts specic contribution to innovation and learning in industries. More broadly, Oinas (2002) expresses concern about the abstractness of some of the trust-related network studies and encourages scholars to pursue more in-depth research into the specific relationships between the economic, the non-economic, and a rm or regions innovation and performance levels. Mackinnon et al. (2002) express similar concerns and stress the need for more comparative, ethnographic, and rigorous investigations into the precise relationships between
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agglomerations, learning, and trust. Such critiques, perspectives, and concerns demonstrate why there is a need for some rethinking about how trust is conceptualized in economic geography, both as a social phenomenon or instrument that emerges from within particular spaces and as a process facilitating (or obstructing) innovation, entrepreneurship, and regional development. III Conceptualizing trust transaction-cost, sociostructural, and constructivist views Rousseau et al. (1998) note that although there are differences in the ways in which trust is conceptualized, social scientists generally agree about its importance and utility in risky or uncertain contexts.2 From a political economy and community development perspective, trust is a key contributor to civil society, a factor granting legitimacy to governments and political institutions, and an indicator of social cohesion (Putnam, 1993; 2000; Platteau 1994a; 1994b; Fukuyama 1995; 2001; Knack et al., 1997; Woolcock, 1998; Lyon, 2000; Forrest and Kearns, 2001; Li, 2004). Within economics, economic sociology, and organizational theory, trust reects the alliance strategies used in interrm and organizational relations and agents (eg, entrepreneurs) able to develop trusting relationships can create information and exchange opportunities unattainable to those more riskor trust-averse (Sako, 1992; 1998; Lane and Bachmann, 1996; Hardin, 2001; Jessop, 2001; Messick and Kramer, 2001; Yamagishi, 2001). Beyond its political and economic contributions, others have documented how trust can improve the quality and efcacy of environmental and natural resource management programs (Pretty and Ward, 2001; Adger, 2003; Carpenter et al., 2004). From a conceptual perspective, much of the overlap in the literature centers on the importance of risk and the vulnerability of the trusting agent since without them trusts relevance is marginal at best (Gambetta, 1988; Mayer et al., 1995). Action is anticipated
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Building trust in economic space governance mechanism that enables agents to conduct repeated transactions more efciently despite there being incomplete information about the true intentions of others. Three underlying issues create a need or justication for trust: 1) the bounded rationality or limited information that constrains the decision-making capabilities of individuals; 2) the value of trust as a highly specic asset that improves the efficiency of particular transactions; and 3) the potential for opportunistic behavior by the other agents in a transaction (Williamson, 1993). In general, trust is conceptualized at two scales, as a rationally calculated input at the micro (individual) scale or as a macro-scale phenomenon enabled through the presence of effective governance structures in an economy or society. In both cases, the focus is on what Granovetter (1985) calls functional trust; trust that serves a distinct utilitarian role in governing the relationships between individuals and rms. In the rst perspective, trust is viewed as an individualized and rationally based input, sunk transaction cost, form of capital, commodity, or lubricant that facilitates the decision-making processes of individuals (Arrow, 1974; Dasgupta, 1988; Lorenz, 1988; Dei Ottati, 1994; Berger et al., 1995; Bhattacharya et al., 1998; Dimaggio and Louch, 1998; Fafchamps, 2001). Actors make (boundedly) rational choices to trust others based on a desire to reduce the transaction costs involved in searching for information, screening potential business partners, monitoring contract compliance, and/or mobilizing resources (Dasgupta, 1988; Williamson, 1993; Dei Ottati, 1994).3 In essence, trust is a calculated outcome of relations that emerges when a threshold is reached beyond which trust becomes a rational choice (Lorenz, 1988; 1999; Gambetta, 1988; Nooteboom, 1999; Jeffries and Reed, 2000; Bohnet et al., 2001). Once trust has been invested in it is rational for actors to continually rely on or draw from relationships where it is present (Dei Ottati, 1994; Fafchamps, 2001). This, in
when trust is extended and the actions enabled through trust encapsulate the interests of both the trusting agent and the trusted agent (Dasgupta, 1988; Bradbach and Eccles, 1989; Lorenz, 1999; Hardin, 2001; 2002). There is also recognition of the importance of distinguishing between trust, a belief in the ability of an individual to meet a mutually beneficial expectation, and trustworthiness, a trust-granting incentive (Mayer et al., 1995; Hardin, 1996; 2002; Glaeser et al., 2000). Moreover, numerous scholars have identied different forms of trust (eg, trust based on shared experiences or trust driven by institutions) and documented their particular contributions to exchange relationships, economic development, innovation, and the constitution of networks (Luhmann, 1979; Zucker, 1986; North, 1990; Sako, 1992; 1998; Williamson, 1993; McAllistar, 1995; Becker, 1996; Cooke and Morgan, 1998; Nooteboom et al., 1997; Doney et al., 1998; Humphrey and Schmitz, 1998; Rousseau et al., 1998; Sako and Helper, 1998; Pixley, 1999; Schmitz, 1999; Sztompka, 1999; Hardin, 2001; Heimer, 2001; Murphy, 2002; Ettlinger, 2003; Bathelt et al., 2004; MacKinnon et al., 2004; Glckler, 2005). Despite the convergences, however, there are signicant differences in the ways in which trust is conceptualized and operationalized in the literature. The discussion that follows organizes these conceptualizations into three broad categories: 1) trust as a rationally calculated and transaction-cost reducing input for exchange relationships; 2) trust as a structurally embedded characteristic of inter- and intra-organizational relations; and 3) trust as an emergent phenomenon constructed through social performances. It is important to note that these categorizations are meant to be heuristic, not necessarily mutually exclusive, as many believe that trust exhibits a combination of these characteristics. 1 Trust as a transaction-cost reducing input for exchange relationships Proponents of transaction-cost explanations view trust as a rationally constructed
James T . Murphy turn, helps to stabilize production systems and can make it difcult for newcomers, even if they have price, information, or cost advantages, to intervene or tap into networks and relationships where trust is well established.4 The second transaction-cost driven approach focuses on the development of the institutions, norms, and property rights that increase the general level of trust in a society or economy. Scholars of the new institutional economics commonly address this perspective and view trust as being an evolutionary outcome or byproduct of history (North, 1990; Dimaggio and Powell, 1991; Platteau, 1994a; 1994b; Fukuyama, 1995; 2001). Effective institutions, manifest as governance structures that reduce the transaction costs associated with economic relationships, help create an environment of trust by protecting property rights and preventing cheating, opportunism, or defection (North, 1990; 1996; Ensminger, 1997; 2001; Dasgupta, 1988; Rowthorn, 1999; Peng, 2004). In contrast to the rst transactioncost perspective, trust is a generalized characteristic of a society or industry and emphasis is placed on understanding how political, economic, and social agencies and actors can foster the development of trustworthy institutions (eg, property rights, contracts, or legal systems) that encourage innovation, entrepreneurship, and investment (North, 1990; Sako, 1992; Landa, 1994; Misztal, 1996; Knack et al., 1997; Hodgson, 1998; Temple and Johnson, 1998; Ensminger, 2001; Helmsing, 2001). While the transaction-cost literature demonstrates how trust can reduce long-run costs and improve performance, it does not sufciently address the contingent, reexive, affective, and ideological forces inuencing collaborative activities or the inevitable power differentials shaping network congurations and the prospects for trust (Beckert, 2002; Mollering, 2002; Ettlinger, 2003; Murphy, 2003). Moreover, contextual realities are often poorly accounted for in these studies, particularly when scholars apply probabilistic
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or game-theory methodologies to explain how trust decision-making processes occur. Such approaches, while successful in accounting for some of the transaction-specic ingredients that may lead to trust, and in achieving statistically rigorous analyses relating trusting outcomes to causal factors, ultimately provide relatively little information about the role of space, place, and context in shaping trust-building processes and perceptions of trustworthiness. 2 Trust as an embedded structural characteristic of organizations and networks In contrast to the transaction-cost perspectives, where trust is a rationally calculated input that facilitates risk taking and collaboration by individuals, organizational theorists and economic sociologists generally view trust as a structurally embedded asset or property of relationships, organizations, and networks that helps to mobilize resources, enable cooperation, and shape interaction patterns within economies, industries, and rms (Granovetter, 1985; Lane, 1998).5 Trust is an organizing principle for business networks and a key ingredient for long-run economic performance (Zucker, 1986; Powell, 1990; Uzzi, 1996; McEvily et al., 2003).6 Embedded or trusting ties offer advantages over arms-length (non-trusting) ties since they can facilitate the transfer of idiosyncratic, context-specic, or restricted forms of information and thus increase the adaptability and flexibility of firms and organizations (Uzzi, 1997; Darr and Talmud, 2003; Uzzi and Lancaster, 2003). Trust, beyond enabling the ow of thicker forms of information, structures and stabilizes networks, contributes signicantly to performance and risk management, and increases knowledge sharing and cooperation (Uzzi, 1997; Bigley and Pearce, 1998; Dimaggio and Louch, 1998; Mizruchi and Stearns, 2001; McEvily et al., 2003). Despite trusts generally positive contributions to economic development, organizational theorists have also observed how it may lead to detrimental outcomes if it is
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Building trust in economic space Kelly, 2002; Veenstra, 2002; Elsbach, 2004; McEvily and Zaheer, 2004). Trust is not a rational choice per se but rather a moral and subjective construct that emerges when one agent complies with the expectancies of a relationship and when ones self identity (ie, his or her perceived social role) is recognized and veried by the other (Garnkel, 1967; Goffman, 1969; Hosmer, 1995). As Burke and Stets (1999) note, trust may be viewed as the stage of a relationship that emerges between self-verification and emotional attachment. In much of this literature, emotions and symbolic affectations are seen as key factors contributing to social cohesion, collaborative behavior, and the strengthening of pre-existing forms of trust (Collins, 1981; McAllistar, 1995; Messick and Kramer, 2001; Ettlinger, 2003; Cook et al., 2004). Feelings or emotional energies may be associated with symbolic representations of morality, trustworthiness, or honesty and an agents ability to control his or her emotions, in accordance with the norms associated with a social situation, increases the probability that trust is achieved (Hosmer, 1995; Jones, 1996; Hardin, 2001; Yamagishi, 2001).7 For example, empathy is an emotional response that contributes to trust building practices (Messick and Kramer, 2001; Cook et al., 2004) and an individuals group membership (ie, how they communicate a specic social identity) may foster feelings that facilitate or prevent the emergence of trusting sentiments (Williams, 2001). Constructivist perspectives add a signicant dimension to our understanding of the trust-building process by drawing attention to the realities and subtleties of the social interactions through which trust or trustworthiness may emerge. Unfortunately, however, most theorizations of trust in the economic development and social capital literature do not sufciently draw from these perspectives focusing instead on trust as a rationally (and often acontextually) calculated social outcome or on how trust, as an input, shapes the
excessively exclusionary and leads to networks that are resistant to change, unable to absorb new innovations, or concerned with illicit, illegal, or cartel-like activities (Baker and Faulkner, 1993; Baker et al., 1998). The strength of these studies lies in the empirical links the authors make between relational characteristics and the entrepreneurial potential or innovativeness of rms, organizations, and individuals. While such contributions are undoubtedly signicant, the focus on patterns and structures, instead of the processes leading to them, offers limited insight into how trust actually emerges in relational settings. Trust-building processes are often implicitly or explicitly assumed to be driven by the need to reduce long-run transaction-costs (see, for example, Kramer and Tylers 1996 volume) and beyond such assumptions there is limited consideration of the power asymmetries and micro-social mechanisms that inuence trust and which shape network structures (Emirbayer, 1997; Emirbayer and Mische, 1998; Bachmann, 2001). Ultimately, network conceptualizations in their present forms only sparsely situate relations within the context of wider structural factors (eg, politics and regulatory environments), individual meaning systems, and the social interactions that perform and sustain them in real places and spaces in the global economy (Fligstein, 1996; KnorrCetina and Bruegger, 2002; Sheller, 2004; Peck, 2005). 3 Affecting trust constructivist views on trust A third area of the literature views trust more as a social outcome and focuses on how agents construct trust through communication and interpersonal negotiation. Although calculations may play a signicant role in such processes, there is an explicit accounting for and engagement with the role of cognitive, emotive, communicative, and contextual factors in enabling trust to develop (Jones, 1996; Hardy et al., 1998; Burke and Stets, 1999; Jarvenpaa and Leidner, 1999; Kavanagh and
James T . Murphy structural configurations of networks and organizations. Because of this, relatively few studies address the ways in which trust and trustworthiness are actually performed through affective displays and symbolic forms of communication in real places or technologically mediated spaces (eg, the internet, videoconferencing). If we are more thoroughly to understand trusts sociospatial dimensions, there is a need to contextualize not only the rationalities, social structures, and logics that enable agents to act in a trustworthy manner (or to grant trust to others) but also the attitudes, feelings, props, and visual cues that are mobilized in the process of constructing trust. In assessing the trust literature as a whole, particularly its relevance for economic geography, two issues stand out. First, while trust is clearly recognized as an important factor influencing the structure of networks, the social characteristics of economies, and the prospects for innovation in rms and industries, it remains somewhat static in its conceptualization. Trust is viewed primarily as a sunk cost, an investment, a relational asset, or a social construct that strengthens a relationship or a networks structure (for better or worse) in a consistent or predictable manner. As such, most conceptualizations of trust inadequately operationalize the dynamic social processes that lead to its emergence and lack sensitivity to the role of place, space, or context in influencing the behavioral choices agents make when assessing or demonstrating trustworthiness. Second, power is surprisingly absent from most conceptualizations of trusts development or application. Trust is typically viewed as a phenomenon distinct from power and one which represents a neutral or balanced outcome of social negotiations. In other words, the individuals involved in trusts creation have certain (appropriate) expectations met that are mutually agreed to and directly proportional to the level of trust between them. Missing from such accounts are the inevitable power differentials that agents mobilize as means for
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achieving coordination or control of anothers behavior. As Allen (1997) observes, the exercise of power is about more than simply constraining or dominating others and can be viewed in terms of the inscribed capacity of individuals or institutions, as a resource for achieving diverse ends (p. 62), or as a mobile or diffuse series of strategies, techniques and practices (p. 63) that can be productive as well as destructive in their application. Theorizations of trust need to explicitly account for the contributions of power if they are more accurately to depict the sociospatial mechanisms that lead to collaborative and/or socially embedded relationships. To address these concerns, this paper advances a power-, space-, and process-sensitive conceptualization of trust, one which views it as a dynamic, contingent, and situated social process, not simply as an endpoint of interpersonal negotiations or an input into economic relations. The focus here is on the mechanisms and practices of trust-building and, indirectly, the means through which trust institutionalizes or embeds relationships within and between particular spaces and places in the global economy. Drawing inspiration from actor-network theory, the social psychology literature, and recent developments in economic geography on the relationality, embeddedness, and social construction of economic space (eg, Lee, 2002; Hess, 2004; Hudson, 2004; and Yeung, 2005a; 2005b), trust is conceptualized as a social process shaped by actors performances, human and non-human intermediaries, and the power differentials between interacting agents; one which is situated in relation to specic geographical contexts and economic logics for exchange and interaction. By doing so, the conceptual framework demonstrates why it is imperative spatially and temporally to situate micro-social practices like trust building if we are to better understand how phenomena such as clusters, interrm networks, value chains, and regional economies are created, transformed, and sustained.
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Building trust in economic space Actor-networks are thus relational entities shaped by power asymmetries and constituted by the chains of interactions or links between/among heterogeneous materials (ie, both human subjects and non-human objects). Agency is an important concern here, particularly in its relationship to actors denitions of themselves and in how agents interpret and utilize knowledge and artifacts in relational settings (Murdoch, 1995; SmithDoerr and Powell, 2005). An agent successfully translates his or her power into desired actions and outcomes through the building up of alliances and by enrolling or ordering heterogeneous materials in his or her network. As Murdoch (1995) observes:
In order for an actor successfully to enroll entities (human and non-human) within a network, their behavior must be stabilized and channeled in the direction desired by the enrolling actor. This will entail redefining the roles of the actors and entities as they come into alignment, such that they come to gain new identities or attributes within the network. It is the intermediaries . . . which act to bind actors together, cementing the links. (Murdoch, 1995: 747)
IV New directions in trust research actor-network theory and social psychology In linking the literature to concerns about how trust-building processes influence the spatial dimensions of networks and regional economies, two conceptual perspectives are particularly useful actor-network theory (ANT) and scholarship from social psychology, ethnomethodology, and symbolic interactionism.8 ANT is signicant because of its focus on the role of technologies, materials, and power differentials as factors shaping the constitution of network spaces; spaces characterized, in part, by varying degrees of trust and distrust. The social psychology literature is helpful because of its concern with the realworld performances and interactions that lead to outcomes such as trust or trustworthiness. The ANT and social psychology literatures are briey reviewed below with an emphasis on linking key theories or perspectives from these elds to conceptual ideas about how trust is constituted and enacted in space. 1 Actor-networks and the trust-building process Actor-network theory is fundamentally concerned with the power relationships and associations that lead to stabilized social and economic practices, networks, scientific knowledge, innovations, and/or institutional structures. A key idea is that economies, markets, laboratories, communities, etc are, in actuality, constituted by particular combinations of human agents, non-human intermediaries, and power expressions that enable actors to set agendas, dene roles and identities, build alliances, and mobilize resources (Callon, 1986; 1999; Latour, 1986; 1993; Law, 1986; 1992; 1994; 1999). Actors are themselves networks, constituted not only by their cognitions and senses of self-identity but also by the set of elements (including, of course, a body) that stretches out into the network of materials, somatic and otherwise, that surrounds each body (Law, 1992: 384).
Beyond addressing issues of agency and power, proponents of ANT view it as a valuable tool for unpacking and understanding the material wheres of interactions, the means through which agents act at a distance (ie, extra-locally) on one another, and the social and cognitive spaces where performances occur and relationships are embedded and ordered (Law, 1986; Latour, 1987; Mol and Law, 1994; Murdoch, 1995; 1997; 1998; Sheppard, 2002; Hess, 2004). When viewed in relation to ANT, trust and trust-building processes are important resources or means for enrolling human agents in networks and thus for stabilizing associations of heterogeneous materials. While certainly related to and inuenced by power relations, trust may serve as a tool for translation or a means for cementing the links that bind agents together in networks. ANT can thus contribute to our understanding of trust by providing a theoretical
James T . Murphy framework through which the materials, intermediaries, and agents that engender trust may be situated within the times, contexts, and spaces where interactions occur. In doing so, it may be possible to identify and catalog some of the place-specic practices and elements that enable (or prevent) trust to (from) emerge (emerging) in a network. In essence, trust can be viewed as a means through which actor-networks are extended across time and space consequently enabling economic agents (eg, rms or entrepreneurs) to develop and stabilize relationships for learning, innovation, and productivity. As Harrisson et al. (2001) note:
[ANT] helps to identify actors involved in an innovation and how they succeed in extending the network, who participates and why, whos opposed and why, and what should be done to win the support of resistant actors. (Harrisson et al., 2001: 219)
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nicant role in determining who is and is not trustworthy. In both cases, there are context and goal-specic symbols, signals, materials, technologies, and actions that can act as intermediaries in or be relevant for trust-making decisions. By focusing on the role of agency in relation to a specic logic or rationale for action, and in a particular place and time, ANT can effectively bring together the combinations of elements that enable economic and social actions to take place (Bruun and Langlais, 2003). 2 The social psychology of trust building ANTs concern with empirical realism, power relations, and the heterogeneity of networks brings it into close contact with social psychology, ethnomethodology, and symbolic interactionism (Law, 1994; 1999). Scholars in these elds have long recognized the importance of performance, social setting, reexivity, and symbolic communication for self-perceptions, individual and group identities, social exchange and practice, and the construction of social and economic systems (Cooley, 1902; Mead, 1934; Goffman, 1959; 1961; 1974; Schutz, 1964; 1967; Garnkel, 1967; Blumer, 1969; Collins, 1981; Fine, 1992; 1993; Hermans et al., 1992; Richardson et al., 1998; Gergen, 1999; Hermans, 1999; 2001; Lawler, 2001; Callero, 2003). Increasingly, economic sociologists and organizational theorists are applying ideas from this literature to studies of the micro-social mechanisms shaping exchange relations, organizations, markets, and commodity chains (KnorrCetina and Bruegger, 2002; McEvily et al., 2003; Rodan and Galunic, 2004). As interest in the sociospatial dynamics of networks increases, geographers too have begun to engage with social psychology in quests for a deeper understanding of the links between context, performance, communicative practice, knowledge transfer, and the formation of business alliances (Oinas, 1999; Thrift, 2000; Bathelt and Glckler, 2003; Tracey and Clark, 2003; Bathelt et al., 2004; Storper and Venables, 2004).
In a sense, resistance or support may be a function of the degree to which an actor creates a sentiment of trustworthiness in the minds of others. For example, in Murdochs (1998) analysis of ANTs spatial applications, he distinguishes between spaces of prescription where appropriate actions, materials, and behavior are relatively durable and xed and spaces of negotiation where the network is more fluid, contested, and continually being adjusted. In the rst case, trustworthiness may be associated with ones adherence to a well-dened and established set of norms, conventions, and routines associated with institutional forms of trust (eg, the activities of currency traders; see Knorr-Cetina and Bruegger, 2002). Moreover, because of this xity, durability, and standardization, actors participating in such networks may nd it possible to act at a distance more effectively. In the second case, where the network is relatively unstable and where identities, roles, and attributes are still being negotiated and contested, one can imagine that proximate variables such as ascriptions, emotions, and observed competence might play a more sig-
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Building trust in economic space another may be trusted. Trust can emerge when the trusted agent effectively realizes or takes on the role of the social or professional self viewed by the trusting agent as appropriate for a particular interaction (Mead, 1934; Blumer, 1969; Burke and Stets, 1999). Third, in exploring the communicative processes that shape social systems, social psychologists often apply the notion of intersubjectivity, what Schutz (1967) and KnorrCetina and Bruegger (2002) refer to as the coordination of consciousness between two (or more) agents, to explain how speech acts, social interactions, and performances lead to mutual understanding. Habermas (1984) and Zierhofer (2002) view intersubjectivity as a critical mechanism for achieving communicative rationality and/or the coordination of social action. Such an understanding occurs when individuals interpretations of physical reality, social norms and expectations, and their personal thoughts, feelings, or perspectives align in the process of proximate or nonproximate (eg, telephone conversations) communication (Schutz, 1967; Knorr-Cetina and Bruegger, 2002; Ziehofer, 2002). As Habermas (1984) observes:
what is paradigmatic for [communicative rationality] is not the relation of a solitary subject to something in the objective world, but the intersubjective relation that speaking and acting subjects take up when they come to an understanding with one another about something. In doing so, communicative actors move in the medium of a natural language, draw upon culturally transmitted interpretations, and relate simultaneously to something in the one objective world, something in their common social world, and something in eachs own subjective world. (Habermas, 1984: 392)
Four ideas from social psychology are especially relevant for the conceptualization of trust-building processes. First, social interactions are shaped by the frames, interpretative frameworks, or situational definitions that agents mobilize or reference during a particular encounter (Mead, 1934; Goffman, 1959; 1974; Garnkel, 1967; Blumer, 1969). Such frames are a function of the logic behind a social interaction and act, in essence, as normative and ontological reference systems that guide an individuals behavior. Situational denitions, when implicitly agreed upon by agents, can lead to mutual understanding and possibly the emergence of trust. However, such understandings may have the opposite effect when an agent recognizes a circumstance where opportunism on the part of another agent is likely or probable (eg, a con game or swindle). Second, social psychologists stress the importance of accounting for reexivity and power asymmetries in social interactions and are concerned with understanding the ways in which individuals objectify themselves as social selves through role playing in relation to a particular frame or situational definition (Cooley, 1902; Thomas, 1923; Mead, 1934). As Callero (2003: 127) notes, the self is a fundamentally social phenomenon, where concepts, images, and understandings are deeply determined by relations of power. In essence, the social who we are is in large part a function of how much power we have in the context of a particular situational frame or denition. For example, individuals who recognize that they have a superior power position in an interaction (eg, a job candidate screener) may be less concerned about appearing good-natured or friendly while those in inferior power positions (eg, a job candidate) may make a more concerted effort to be liked and to display positive emotional expressions. Individuals consistently reect upon where they stand in an interaction and make adjustments accordingly in order to improve the prospects for achieving trust or for understanding the degree to which
In applying the concept more directly to trust, it is clear that interpretations of an individuals trustworthiness will be shaped, in part, by the degree to which intersubjectivity is achieved in the communicative process. Fourth, social psychologists recognize the importance of personal appearance and performative space in determining what roles
James T . Murphy and actions are appropriate, acceptable, and useful for achieving a specic objective or outcome. Goffman (1959) views the personal front and the setting as key elements of any social performance and distinguishes between front regions where impression management is crucial and back regions where less formalized and structured encounters take place. As Law (1994) observes in relation to the activities of scientists at the Daresbury laboratory:
Frontstage, there are bright-eyed, bushy-tailed performances. And backstage there is all the effort that goes into mounting those performances. But the dualism is not only epistemological, but also moral. For what goes on frontstage is also a form of impressionmanagement, and it slides easily into dissimulation [feigning], or suspicion of dissimulation. So it is that in enterprise the syntax of performance gets divided from the syntax of reality, and the need to perform starts to erode the possibility of trust. (Law, 1994: 176)
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While performances frontstage must convey legitimacy, competency, trustworthiness, and/or appropriateness, there is the danger that such performances may be perceived as acted or less meaningful expressions. The point is that, while performances are undoubtedly important, trust does not emerge through them alone as it is also shaped by institutional structures and the calculations, dispositions, and prior experiences of individuals. In sum, social psychology offers insights into the ways in which actors dene situations, conduct social performances, constitute themselves and each other, and relate observations of anothers behavior to their subjective understandings of the world. In relating these ideas to trust, space, and economic development, there are two key considerations that theories should address. 1) Where is the frontstage and what are the frontstage performances (ie, the impression management strategies) that lead to trust in a particular business situation? 2) How are interpretations of appropriate (ie, trust-inducing)
social selves inuenced by where someone is from and with who and where they normally conduct business? In addressing these questions there is an implicit recognition of and accounting for the socio-economic contexts and performance spaces where trust is constructed as such settings significantly inuence the situational frameworks, speech acts, or behavioral assumptions deemed appropriate. Taken together, the ANT and social psychology literatures offer theoretical and methodological guidance for ways in which we can more rigorously consider what Hudson (2004: 457) terms the processes and interplay between the realms of the material, the symbolic, and the social through which the meanings of commodities are created, xed, and reworked. In this case, the commodity might be viewed as trust but the conceptual emphasis transcends the view that trust is merely a resource or input for socioeconomic relations. Instead, the focus is on how social actors generate meanings about what trust entails and how a stabilized or xed (at least temporarily) understanding of its implications might lead to distinct economic practices and outcomes. By applying ANT and social psychology to examine the social processes that lead to the development of trust, economic activities can be situated within the discursive spaces where they occur, not simply in terms of rational choices and transaction-cost calculations. In doing so, there is an explicit recognition of the ways in which power is practiced, intermediaries are mobilized, and social performances take place through communicative processes and interpersonal negotiations. As Lee (1989; 1997; 2002), Hudson (2004), and Yeung (2005a; 2005b) have observed, the performance of economies and rms is determined in large part by such relations and discursive practices as they enable communication, offer direction, facilitate evaluation, and, most signicantly, lead to shared understandings about who does what, why, when, and where. Moreover, these
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Building trust in economic space Trust not only inuences the quality or strength of particular associations in a network but also the networks spatial extensiveness and openness to new participants and ideas. Trust-building processes are communicatively driven and shaped by inuences at three scales the micro (the subjective), the meso (intersubjective), and the macro (the structural or institutional). These scales or levels correspond to Emirbayers (1997) model of the key dimensions of relational thinking individual-level identities, understandings, and embodiments (the micro scale), face-to-face or person-to-person encounters (the meso scale), and the norms, values, identities, and institutions that are embedded in a social system (the macro scale). Moreover, these levels may be linked to Humphrey and Schmitzs (1998) typology of micro-scale, meso-scale, and macro-scale forms of trust. At the micro scale, trust is constructed over time and through subjective interpretations of shared experiences and the competence of another agent. At the meso scale, feelings of trust emerge through faceto-face or person-to-person encounters and on the basis of ascriptions, group memberships, or other characteristics the trusting (distrusting) agent ascribes to or associates with trustworthy (untrustworthy) individuals (eg, race, religion, or appearance). Macrolevel trust is more generalized, derived from institutionalized attitudes about the trustworthiness of people, from religious or philosophical values, or from beliefs in the ability of government or other institutions to protect ones rights should his or her trust be violated. Ultimately, the decision to trust must occur at the micro scale where agents evaluate and consider the risks, benets, performances, and institutions inuencing a particular exchange relationship or social interaction. Trust emerges when there is congruence between the trusting agents expectations about appropriate roles in a given situation and the actions performed by the trusted agent (Goffman, 1961; Sztompka, 1999; KnorrCetina and Bruegger, 2002; McEvily et al.,
social processes and negotiations shape the spatial structures of rms and industries and inuence the prospects for innovation and growth in regional economies. Beyond helping to unravel some of the complexities, practices, and contingencies of inter-, intra-, and extra-rm relationships, ANT and social psychology compel us to have a deeper understanding of, or appreciation for, the actual contexts, spaces, and locations where networking occurs, trust emerges, and collaborative institutions become embedded. The remainder of the paper applies these literatures, as well as key ideas from the extant trust literature, to the development of a heuristic conceptual framework for trust; one that unpacks and details the cognitive, intersubjective, and structural factors inuencing the sociospatial process of trust building. V Reconceptualizing trust-building processes The conceptual framework that follows applies seminal ideas from the literatures reviewed above to depict the sociospatial process through which trusting relationships emerge; one which will facilitate the unpacking of the dispositions, meanings, symbols, norms, materials, spaces, and power relations that inuence the decision-making processes of individuals within particular relational settings. Trusting relationships and network connections are theorized here as temporalrelational elds which emerge from within particular social, material, and political settings and which are maintained and transformed through the cognitions, symbolic exchanges, and performances of the agents in them (Collins, 1981; Emirbayer and Mische, 1998). These relational spaces may be ephemeral, mobile, and highly uid in nature or they may be xed, stabilized and embedded in particular territories, networks, locations, or spaces through markets, cultural systems, norms of participation, locationdriven contingencies, or established ties between individuals (Mol and Law, 1994; Hess, 2004; Sheller, 2004).9
James T . Murphy 2003). Appropriateness is a function of factors at the micro (subjective or cognitive), meso (intersubjective), and macro scale (structural or institutional) and depends on the trusting agents denition of the situation, a definition shaped by the logic or rationale for the interaction. In the business world, such logics or rationales may relate to material goods (eg, the need to access resources through relations with a supplier), technology or knowledge transfer processes, or symbolic issues (eg, the desire to build a reputation through relations with a customer). When an agent pursues a particular logic through an interaction, he or she activates an interpretative framework that inuences how risks and rewards are calculated (the micro scale), how performances or encounters are evaluated (the meso scale), and which norms, rules, laws, or conventions (the macro scale) are referenced (Garnkel, 1967; Goffman, 1969; Knorr-Cetina and Bruegger, 2002). Figure 1 summarizes how an interpretative framework is constituted in relation to the three scales. At the micro or subjective scale, trust-building practices are inuenced by an individuals disposition or general willingness to trust, her perceived power or control of the situation, her calculation of the risks and uncertainties related to the extension of
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trust, and her assessment of the rewards associated with, or interests encapsulated through, the actions derived from the establishment of trust. The meso or intersubjective scale is constituted by the personal front and the setting (Goffman, 1959). The personal front is constructed through the performance or embodiment of speech acts, expressions, gestures, emotional energies, and social cues or signicant symbols (Mead, 1934; Goffman, 1959; Blumer, 1969; Collins, 1981; Burke and Stets, 1999; Lawler and Thye, 1999; Lawler, 2001). The setting relates to the physical locations and spaces within which or across which the interaction occurs (eg, face-to-face, faceto-screen) and the props, appearances, materials, and technologies that can mediate these exchanges (Goffman, 1959; Knorr-Cetina and Bruegger, 2002). At the macro scale, the role of wider institutions, structural conditions, circumstances, and hierarchies are accounted for and these include the laws, norms, and rules for conducting business, the value systems embodied in religious beliefs or political ideologies, and the sanctioning institutions (eg, the legal system) that can help an agent respond to opportunistic behavior. Beyond such institutions and structures, there is a need to consider the positionality of the rm or individual within a wider society or the global economy (Sheppard, 2002). Position
Figure 1
Conceptualizing the trust-building process
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Building trust in economic space instead emerge in relation to one another and to the sociospatial contexts where individuals interact. Ultimately, the conceptualizations purpose is not to reduce or disassemble trust into set of constitutive parts or components but instead to demonstrate heuristically how trust-building processes are complex, communicatively driven, geographically contingent, and inseparable from exercises or structures of power and control. VI Concluding remarks Beyond applications of the conceptual framework to examinations of how trust contributes to innovation and knowledge creation in clusters, learning regions, production networks, value chains, and urban economies, three directions for future research are especially intriguing. First, there is a need to understand better the processes through which crosscultural and crosscontextual business alliances and relationships develop in the global economy. Such research will be especially important in determining how rms in developing and emerging economies can create more durable and trusting transnational relationships to facilitate innovation and growth (see, for example, Saxenian and Hsu, 2001). Second, there is a need for more research into the dynamics of collaboration and trust-building within non-embodied relational spaces, particularly those enabled through information and communication technologies (eg, the internet). Knorr-Cetina and Brueggers (2002) fascinating study is a prime example of research in this regard as it illustrates how currency markets are in reality constructed through global chains of interactions playing out through responsive or face-to-screen encounters between individuals situated in ofces all over the world. Third, the framework can be applied to studies that focus on the power asymmetries that shape collaborative relationships in order to determine how power is constituted within and inuenced by the social spaces where individuals interact and the wider geographical contexts where rms and industries are situated.
might be related to or derived from social class, market power, the location of the business, or the rms position in a global value chain. Finally, it is also imperative to account for the inuence of economic or industryspecic circumstances and present-day structural or institutional realities (eg, conditions created by a dramatic economic reform process or a political crisis) as inuences on trusts potential development. Jones (1996), using an extreme example, cites Chinas Cultural Revolution as a period or climate when generalized distrust was the norm and there were generally few incentives for trusting others. Other, perhaps less extreme, climate-influencing factors might relate to place or region-specic changes in regulations and laws, the general performance of markets and industries, geopolitical issues, ethnically driven or class-based conicts, or natural and human-created disasters. In applying this conceptual framework to empirical research it will be imperative to obtain detailed descriptions from individuals about how they develop and dene trust in relation to particular economic logics (eg, a supplier relationship, customer relationship, or a business alliance). In doing so, the role and signicance of micro-scale, meso-scale, and macro-scale factors can be elucidated in terms of how they inuence trusts emergence in a particular business relationship, economic situation, and geographic context. It is crucial to note, however, that while recognizing and acknowledging the diverse contributions of these factors remain important, what is essential is the specic manner in which they are collectively realized in a relationship or social encounter. As Mansfield (2005: 472) recently asserted, scales are best viewed as dimensions of particular events and processes always produced in complex interrelation with, and as aspects of, other scales. In linking this notion to the conceptual framework presented here, micro-, meso-, and macro-scale characteristics of trustbuilding processes are not interlinked in a linear, hierarchical, or accumulative fashion, but
James T . Murphy In closing, it is important to stress that the conceptualization presented here is intended to be more than simply a collection of variables or influences on the trust-building process. While accounting for the role of such factors surely is important, the framework also offers a means for considering and understanding the ways in which collaborative practices, trusting relationships, and network associations are situated within distinct times, places, and interactive spaces through particular combinations of materials, symbols, social practices, and institutions. By situating trust and collaboration in this manner, it may be possible to shift away from static conceptualizations of sociospatial economic phenomena (eg, agglomeration economies) to more place-, space-, and process-sensitive understandings of how value chains, clusters, knowledge ows, and transnational alliances are actually constituted. Issues of agency and power shift to center stage and scale, while relevant in a conceptual sense, is collapsed into the context of a single association or network relationship. Thus the conceptualizations broader significance lies not in describing how factors at different scales inuence trust but rather in its unpacking of trust in relation to the actual agents, spaces, and places where it emerges and in its contextualization of the micro-social processes that drive the relationships and networks that ultimately constitute rms, industries, markets, and economic regions. In doing so it can facilitate, through empirical research, a move beyond solely instrumental conceptualizations of trust (ie, trust as lubricant, relational asset, input, or sunk cost) and toward a relational understanding of how the means for establishing and sustaining collaborative relationships influences the development and potential of such ends as clusters and production networks. Acknowledgements The author would like to sincerely thank Roger Lee and three anonymous reviewers for their thoughtful and highly constructive
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comments on earlier drafts of the manuscript. The usual disclaimers apply. Notes
1. Two recent examples demonstrate these sorts of contributions. First, Ettlinger (2003) shows why it is important to account for trusts different forms or sources (eg, trust based on capacity or trust based on feelings) in order to understand better how and why discriminatory (or more equitable) management practices emerge within particular workplaces. Second, Mackinnon et al. (2004) in their study of the Aberdeen oil industry, nd that local reputation and credibility, what they consider lower-level forms of trust, play a greater role in the development of extra-local business relationships than they do in the establishment of local information and knowledge transfer networks. As Rousseau et al. (1998) note, economists generally view trust as a rationally calculated risk, psychologists as an internal cognition, and sociologists as a socially embedded property of relationships. Williamson (1993) argues that rationally calculated trust is really a form of risk taking, not trust as he understands it. For him, real trust can only be personal and emotional (eg, the trust we have in people we love) or hyphenated (eg, the trust we have in political, cultural, social, or economic institutions). Methodologically, studies of trust from this literature often involve surveys and statistical analyses of the key factors driving trust decisions (eg, reputation, experience, etc), game theory studies using prisoner dilemma-type methods to assess trust-making probabilities, or experimental trust games with real people (Butler, 1991; Nooteboom et al., 1997; Bhattacharya et al., 1998; Glaeser et al., 2000; Bacharach and Gambetta, 2001; Buchan et al., 2002; Barr, 2003; Carpenter et al., 2004). For a more thorough assessment of perspectives on trust from economic sociology and organizational theory, see Kramer and Tylers (1996), Lane and Bachmanns (1998), and Kramer and Cooks (2004) edited volumes. Beyond assessing trusts structural contributions to organizations, networks, and market
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institutions, organizational theorists and economic sociologists have also explored the complementary relationships between trust and distrust, the fuzzy boundaries between trust, control, and power, the communicative dimensions of trust-building processes, trusts importance for leadership, and the role of institutions, histories, and cultures as inuences on trusts constitution (Lane and Bachmann, 1996; Das and Teng, 1998; Doney et al., 1998; Lewicki et al., 1998; Bachmann, 2001; Reed, 2001; Kramer and Cook, 2004). An alternative perspective on the role of emotions views them as rationally constructed instruments, objects, expressions, gestures, or symbols that inuence the dynamics of social interactions and foster the emergence of specific social patterns in a society (Kemper, 1978; Heise, 1979; 2005; Frank, 1988; Lawler et al., 2000). Throughout most of the remainder of the paper the social psychology, ethnomethodology, and symbolic interactionism literatures are referred to collectively as social psychology. A highly fluid space might entail the interactions between people in a subway car or through a mobile communication device while a more xed and stabilized space would be a boardroom or the shop oor of a manufacturing plant. See Sheller (2004) for a helpful discussion on the increasing importance of technologically mediated and highly uid interactive spaces in contemporary cities.
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Building Trust in Economic Space

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Progress in Human Geography 30, 4 (2006) pp. 427450

Building trust in economic space

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Conceptualizing the trust-building process

Building trust in economic space

Building trust in economic space

Building trust in economic space

Building trust in economic space

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