Chinese Journal of Sociology ›› 2010, Vol. 30 ›› Issue (3): 65-82.

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Between Institution and Guanxi: Trust Building for Small Business Loans from the Commercial Bank

Yang Huiyu, Public Management School, Nanjing University of Information Science & Technology   

  1. Yang Huiyu, Public Management School, Nanjing University of Information Science & Technology
  • Online:2010-05-25 Published:2010-05-25
  • Contact: Yang Huiyu E-mail:E-mail:yanghuiyu@nuist.edu.cn
  • Supported by:

    The research was supported by Social Science Foundation of Jiangsu Provice:Middle and Small Corporations Credit System Construction of Jiangsu Province(08SHB003).

Abstract:

Abstract: From the perspective of trust, this paper discusses how the relational trust and the institutional trust interact in trading exchanges to stimulate the loan business. Both function through actors, who follow the “selfsituation” strategy. The institutional trust has a prominent position in the economic life, and possesses its independence to some extent. It is the foundation of modern enterprising, and it is not substitutable. What is missing in the institutional trust may be complemented by the relational trust; the risks in the relational trust, however, must be controlled by the institutional trust. Only when a good institution is established can guanxi(relation) play a positive role and overcome its negative effects.

Key words:  commercial bank  ,  Guanxi  ,  institution  ,  small business loan  ,  trust