The Value of Relationships : Evidence from a Supply Shock to Kenyan Rose Exports

  title={The Value of Relationships : Evidence from a Supply Shock to Kenyan Rose Exports},
  author={Rocco Macchiavello Ameet Morjaria},
  • Rocco Macchiavello Ameet Morjaria
  • Published 2010
This paper provides evidence on the importance of reputation, intended as beliefs buyers hold about seller’s reliability, in the context of the Kenyan rose export sector. A model of reputation and relational contracting is developed and tested. We show that 1) the value of the relationship increases with the age of the relationship; 2) during an exogenous negative supply shock sellers prioritize relationships consistently with the predictions of the model; and 3) reliability at the time of the… CONTINUE READING

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