Client firms test subcontractor trustworthiness through staged contract commitments over years.

Evidence

To know whether a subcontractor is trustworthy (and this is my fourth point) they rely additionally on their own experience. One manager said a minimum of a year and a number of contracts was required, though he claimed that after three months he had an intuitive sense of how things would turn out based on personal contact with his opposite number. Another firm gave the figure of two to three years. During this period they operated a conscious testing process. Initially short-term contracts were given, it being understood that renewal would depend on performance. Once satisfied, a one-year contract was offered in which for a fixed price they guaranteed a level of work. At this point, ‘according to the manager, the two firms were partners. — Diego Gambetta, Trust - Making and Breaking Cooperative…, 2613

Categorization

• XREF: Directly evidences the reader’s Hardin thesis: trust is built through observable constraints (staged contract testing) before partnership. — connects to: Listed firms’ value depends on sustained investor relationship building. — Kean Birch, Rethinking Value in the Bio-economy:…, 101
• DEFINE: Defines ‘incremental trust’ — trust built up in successive, observable stages rather than granted wholesale.