The effect of equity on value co-creation in business relationships

Abstract

Purpose This study aims to investigate how the relationship factors, including equity, shared responsibility and relationship dependence leverage the value co-creation. The research studies the value co-creation process in a business-to-business (B2B) context between suppliers and customers and provides empirical evidence of the underlying effects. Design/methodology/approach Using social exchange theory, the research uses a mixed-method of in-depth interviews and questionnaire surveys. The sample of the survey has 123 business customers. Findings The findings suggest that equity not only positively affects but also mediates the effect of shared responsibility on value co-creation. The mediation effect is further moderated by the relationship dependence that buyers have on the seller. Research limitations/implications The cross-sectional survey used cannot establish causality relationships. Although the goal was not to establish causality, it could limit the rigor of the study. The longitudinal design could be used in the future to better address this deficiency. While the paper is the initial step to analyze the factors influencing value co-creation empirically, more studies could examine other commonly discussed constructs. Originality/value This empirical study enriches the value co-creation literature by examining the antecedents’ detailed mechanism that facilitates value co-creation in a B2B context.