INTERDEPENDENCE, PUNITIVE CAPABILITY, AND THE RECIPROCATION OF PUNITIVE ACTIONS IN CHANNEL RELATIONSHIPS

Using data from automobile dealers in the Netherlands, the authors fin d that dealers' punitive actions toward their key suppliers are affect ed by their perceptions of their own and their supplier's interdepende nce and punitive capabilities, as well as by the supplier's punitive a ctions. Punitive actions are affected by interdependence, but a more c omplete picture is achieved by also examining punitive capability. The authors test hypotheses based on bilateral deterrence, conflict spira l, and relative power theories, but none of these comprehensively expl ains the effects of both total power and power asymmetry. Dealer punit ive actions are inhibited as total interdependence increases, but are promoted as total punitive capability increases. Using spline regressi on, the authors find that interdependence asymmetry has no direct effe ct on punitive actions, whereas punitive capability asymmetry does. As dealers' punitive capability advantage as compared with their supplie rs' increases, dealers make greater use of punitive actions, whereas t hey use fewer punitive actions as their punitive capability deficit in creases. The authors also find that dealers with a relative advantage in dependence or punitive capability are more likely to reciprocate th eir supplier's punitive actions.