Abstract:

In channel relationship with dependence asymmetry, it remains unanswered whether contract governance could curb the opportunistic behavior of two parties in the relationship. In the context of contractual channel of agriculture products, this study investigates the effect of contract governance on the opportunistic behavior of two parties (farmer and buyer) in channel relationships, as well as the moderating role of two important environmental variables, market uncertainty and government support. Findings show that, despite of dependence asymmetry, explicit contract can directly curb opportunistic behavior of two parties in channel relationships. Moreover, the market uncertainty and government support have different moderating roles. Specifically, market uncertainty strengthens the effect of explicit contract on farmer （the more dependent one） opportunistic behavior, but it does not moderate the effect of explicit contract on buyer （the less dependent one）opportunistic behavior. Additionally, government support weakens the effect of explicit contract on farmer opportunistic behavior, but strengthens the effect of explicit contract on buyer opportunistic behavior. Finally, this paper includes a discussion of the research findings, corresponding managerial suggestions and the future research directions.

Key words: contract explicitness, opportunistic behavior, market uncertainty, government support, dependence asymmetry