Asia pacific journal of information systems

The Korea Society of Management Information Systems (한국경영정보학회)
권호 표지

Trust, Perceived Risk, and Trusting Behavior in Internet Banking

  • Published : 2009.09.30
Download PDF
⟨ Previous Next ⟩

Abstract

In information systems, "trust" and "risk" have been explored by a few trust-related research studies before, but as two separate issues. The way in which these studies have been designed, however, does not help clarify the relationship between trust and risk since they are studied as unconnected determinants of trusting behavior in electronic commerce. As such, this research attempts to examine and specify the relationships among the core constructs surrounding the issue of trust such as risk and trusting behavior. The context of Internet banking adoption is used to develop a conceptual model that incorporates the direct effects of trust and perceived risk on trusting behavior as well as the mediation of the relationship between trust and trusting behavior by perceived risk. The findings show that perceived risk mediates the relationship between trust and trusting behavior. Specifically, trust in the Internet as a banking medium significantly influences the adoption of Internet banking both directly and indirectly through perceived risk of Internet banking. Trust that the bank will not take advantage of consumers significantly influences the trusting behavior through perceived risk of Internet banking. This study, thus, extends research on trust in e-commerce by simultaneously examining the influence of trust and perceived risk on e-commerce adoption.

Keywords

References

  1. Andaleeb, S., "The trust concept Reserch issues for channels of distribution," Research in Marketing, Vol 11, 1992, pp. 1-34
  2. Barron, R. and Kenny, D., "The moderatormediator variable distinction ìn social psychological research: Conceptual, strategic statistical considerations," Joumal of Marketing Research, Vol. 19, 1986, pp. 229-239
  3. Bentler, P., EQS Structural equations program manual, Multivariate Software, Inc., CA, 1995
  4. Berger, J., Noorderhaven, N., and Nooteboom, B., The determinants of supplier dependence: An empirical study. In J. Groenewegen, C. Pitelis, and S. E Sjostrand (Eds.), On economic institutions: Theory and applications, Aldershot (pp. 195-212). England: Edward Elgar, England, 1995
  5. Castelfranchl, C. and Tan, Y., "The role of trust and deception in virtual societies," International Journal of Electronic Commerce Vol. 6, No. 3, 2002, pp. 55-70 https://doi.org/10.1080/10864415.2002.11044243
  6. Chiels, T. and McMackin, J., "Integrating variable risk preferences, trust, and transaction cost economics," Academy of Management Review, Vol. 21, No. 1, 1996, pp. 73-99 https://doi.org/10.2307/258630
  7. Cho, V., "A study of the roles of trust and risks in inforrnation-oriented online legal service using an integrated model," Information and Management, Vol. 43, 2006, pp. 502-520 https://doi.org/10.1016/j.im.2005.12.002
  8. Coleman, J., Foundations of Social Theory, Harvard University Press, Cambridge, MA, 1990
  9. Cooper, D. and Emory, W., Business research methods. (5th ed.), Irwin, Chlcago, 1995
  10. Cummings, L. and Bromiley, P., The organizational trust inventory. In Kramer, R.M and T.R. Tyler (Eds.), Trust in Organizations: Frontiers of Theory and Research(pp. 302-330), sage Publications, Thousands Oaks, 1996
  11. Das, T. and Teng, B., "Between trust and control: Developing confidence in partner cooperation in alliances," Academy of Management Review, Vol. 23, No. 3, 1998, pp. 491-512 https://doi.org/10.2307/259291
  12. Elangovan, A. and Shapiro, D. "Beteayal, of trust in organizations," Academy of Management Review, Vol. 23, No. 3, 1998, pp. 547-566 https://doi.org/10.2307/259294
  13. Fishoff, B., Watson, S., and Hope, C., Defining risk. In T.S. Glickman, and M. Gough (Eds.), Readings in risk(pp. 30-41), Resources for the Future, Washlngton, DC, 1990
  14. Gefen, D., "Customer loyalty in e-commerce," Joumal of the Association for Information Systems, Vol. 3, 2002, pp. 27-51 https://doi.org/10.17705/1jais.00022
  15. Gefen, D., Karallanna, E., and Straub, D.W., "Trust and TAM in online shopping: An integrated model," MIS Quarterly, Vol. 27 No. 1, 2003, pp. 51-90 https://doi.org/10.2307/30036519
  16. Govindarajan, v., and Fisher, J., "Strategy, control systems, and resource sharing: Effects on business-unit performance" The Academy of Management Journal, Vol. 33, No. 2, 1990, pp. 259-285 https://doi.org/10.2307/256325
  17. Hillm C.W.L., "Cooperation, opportunism and the invisible hand: Implications for transaction cost theory," Academy of Management Review, Vol. 15, 1990, pp. 500-513 https://doi.org/10.2307/258020
  18. Hamblem, M., Financial firms give mobile banking a boost, Computerworld, April 2007
  19. Hoffman, K.E., Mobile banking: Where's the business case? Banking Strategies, 2007
  20. Hosmer, L.T., "Trust: The connecting link between organizational theory and phllosophical ethlcs," Academy of Management Review, Vol. 20, No. 2, 1995, pp. 379-399 https://doi.org/10.2307/258851
  21. Jarvenpaa, S. and Leidner, D., "Communication and Trust in Global Virtual Teams," Organization Science, Vol. 10, No. 6, 1999, pp. 791-815 https://doi.org/10.1287/orsc.10.6.791
  22. Jarvenpaa, S. and Todd, P., "Consumer reactions to electronic shopping on the World Wide Web," International Journal of Electronic Commerce, Vol. 1, No. 2, 1996-7, pp. 59-88
  23. Jarvenpaa, S. and Todd, P., "An empirical examination of the detenninants of attitudes and intention toward shopping on the Internet," working paper, University of Texas, 1998
  24. Kandra, A., Banking on the web: Risky business? PCWorld, March 2006
  25. Karahannas, M.V. and Jones, M, Interorganizational Systems and Trust in Strategic Alliances, Proceedings of the Twentieth International Conference on Inforrnation Systems, Charlotte, North Carolina, 1999
  26. Kuan, H.H. and Bock, G.W., "Trust transference in brick and click retailers: An investigation of the before-online-visit phase," Information and Management, Vol. 44, 2007, pp. 175-187 https://doi.org/10.1016/j.im.2006.12.002
  27. Lee M.K.O. and Turban, E., "A trust model for consumer internet shopping," Internatíonal Journal of Electronic Commerce, Vol. 6, No. 1, 2001, pp. 75-91 https://doi.org/10.1080/10864415.2001.11044227
  28. Lewicki, R. and Bunker, B., Trust in relationships: A model of trust development and decline. In B. Bunker, and J. Rubin (Eds.), Conflict, cooperation and justice(pp. 133-173). Jossey- Bass, San Francisco, 1995
  29. MacCrimmon, K. and Wehrung, D., Taking risks: The management of uncertainty， Free Press, New York, 1986
  30. March, J. and Shapira, Z., "Managerial perspectives on risk and risk taking," Management Science, Vol. 33, 1987, pp. 1404-1418 https://doi.org/10.1287/mnsc.33.11.1404
  31. Mayer, R.C., Davis, J., and Schoorman, F., "An Integrative Model of Organizational Trust," Academy of Management Review, Vol. 20, No. 3, 1995, pp. 709-734 https://doi.org/10.2307/258792
  32. McAllister, D.J., "Affect- and cognition based trust as foundations for interpersonal cooperation in organizations," Academy of Management Journal, Vol. 38, No. 1, 1995, pp. 24-59 https://doi.org/10.2307/256727
  33. Mcknight, H. and Chervany, N., "What trust means in E-Commerce customer rclationships: an interdisciplinary conceptual typology," International Journal of Electronic Commerce, Vol. 6, No. 2, 2001-2002, pp. 35-59
  34. Neter, J., Kutner, M., Nachtsheim, C, and Wasserman, W., Applied linear statistical models. (4$^t^h$ ed.), Irwin, Chicago, 1996
  35. Nooteboom, B., Berger, H, and Noorderhaven, N., "Effects of trust and governance on relational risk," Academy of Managemmt Journal, Vol. 40, No. 2, 1997, pp. 308-338 https://doi.org/10.2307/256885
  36. Pavlou, P.A., "Consumer acceptance of electronic commerce: Integrating trust and risk with the technology acceptance model." International Journal of Electronic commerce，Vol. 7, No. 3, 2003, pp. 101-134
  37. Pavlou, P.A. and Gefen, D., "Building effective online marketplaces with institution-based trust," Information Systems Research, Vol. 15, No. 1，2004，pp. 37-59 https://doi.org/10.1287/isre.1040.0015
  38. Peter, T., Thriving on Chaos. Alfred A. Knopf, New York, 1988
  39. Roll, R., "The hubris hypothesis of corporate takeovers," Journal Business, Vol. 59, 1986, pp. 197-216 https://doi.org/10.1086/296325
  40. Rousseau, D., Sitkin, S., Burtm R., and Camerer, C., "Not so different after all: A cross-discipline view of trust," Academy of Management Review, Vol. 23, No. 3, 1998, pp. 393-404 https://doi.org/10.1111/j.1365-246X.2007.03696.x
  41. Schneider, F.B. (eds.), Trust in Cyberspace, National Academy Press, Washington, D.C., 1998
  42. Sliwa, C., More than 25% of online transactions fail, ComputerWorld，March 2000
  43. Sitkin, S., "On the positive effects of legalization on trust," Research on Negotiation in Organizations，Vol. 5, 1995, pp. 185-217
  44. Sitkin, S.B. and Roth, N., "Explaining the limited effectiveness of legalistic 'remedies' for trust/distrust," Organizatíon Science， Vol. 4, No. 3, 1993, pp. 367-392 https://doi.org/10.1287/orsc.4.3.367
  45. Sitkin, S.B. and Pablo, A., "Reconceptualìzing the Determinants of Risk Behavior," Academy of Management Review, Vol. 17, No. 1, 1992, pp. 9-38 https://doi.org/10.2307/258646
  46. Tan, Y.H. and Thoen, W., "A generic model of trust in electronic commerce," Intematíanal Journal of Electronic Commerce, Vol. 5, No.2, 2000，pp. 61-74 https://doi.org/10.1080/10864415.2000.11044201
  47. Williamson, O., "Calculativeness, trust, and economic organization," Journal of Law and Economics, Vol. 34, 1993, pp. 453-502 https://doi.org/10.1086/467284
  48. Xiao, B. and Benbasat, I., "E-commerce product recommendation agents: Use, characteristics, and impact," MIS Quarterly, Vol. 31, No. 1, 2007, pp. 137-209 https://doi.org/10.2307/25148784
  49. Yiu, C.S., Grant, K, and Edgar, D., "Factors affecting the adoption of Internet banking in Hong Kong-implications for the bankong sector," lnternational Journal of lnformtion Management, Vol. 27, 2007, pp. 336-351
  50. Zucker, L., Production of trust: Institutional sources of economic structure, 1840-1920. In B.M Staw, and L. Cummings (Eds.), Research in Organizational behavior pp. 53-111. JAI Press, Greenwich, CT, 1986