Title: The role of trust in risk sharing and innovativeness of service firms in Nigeria

Authors: Benjamin Anabori Mmadu

Addresses: University of Nigeria, Nsukka PMB 14, Nsukka, Enugu State, Nigeria

Abstract: Firm's innovation and knowledge expansion have become critical issues in sustaining competitive advantage, especially in large and mature organisations. Firms cannot survive without being able continuously to renew and innovate. This study aims to evaluate the role of trust in innovative risk sharing among service firms in Nigeria. Qualitative research design was adopted and 15 firms and 220 respondents in the service industry were sampled. Research findings revealed that, institutional trust has an important role in determining organisational innovativeness. It further revealed that trust reduces the cost of risk among firms. The study concludes that innovation suffers under distrust and recommends that there should also be sufficient stability to elicit the specific investments needed to build mutual trust that permits collaboration to flourish and enhance creative innovation among firms.

Keywords: mutual trust; innovation; knowledge sharing; uncertainty; risk sharing; service firms; entrepreneurial behaviour; vertical trust; lateral trust; institutional trust; services; entrepreneurship; Nigeria; collaboration; innovativeness.

DOI: 10.1504/IJSEM.2013.059575

International Journal of Services, Economics and Management, 2013 Vol.5 No.4, pp.341 - 359

Received: 03 Jul 2013
Accepted: 14 Nov 2013
Published online: 30 Apr 2014 *

Full-text access for editors Full-text access for subscribers Purchase this article Comment on this article