The Influence of Prior Ties on Trust in Contract Enforcement

Construction Industry: Moderating Role of the Shadow of the Future 2 Yuting Chen1; Yongqiang Chen2; Zhaojun Liu 3; Hongjiang Yao4 3 Abstract: This paper explores the effect of prior ties on trust in contract enforcement after contractual breaches, 4 which is underdeveloped in the existing literature, from a multi-functional perspective. In this research, both 5 goodwill-based and competence-based trust have been distinguished to explore their mediating effects on the 6 influence of prior ties on contract enforcement; two diverse functions of contracts, controlling and coordination, 7 have been differentiated. This study also examines the moderating effects of the shadow of the future on these 8 functions. Using data gathered from a paper-based survey of 195 Chinese general parties in the construction 9 industry, we posit that prior ties between contracting parties will improve the level of both goodwill-based and 10 competence-based trust between them, so negatively influencing the severity of contract enforcement. 11 Furthermore, the inhibiting effects of competence-based trust on the severity of coordination contract 12 enforcement will be strengthened under the circumstances of a higher likelihood of continued cooperation. This 13 study offers a deep and nuanced understanding of contract enforcement. 14