Factors Affecting Individual Decisions Based on Business Legitimacy

ABSTRACT

In this paper, we study customer's legitimacy preferences from the perspective of individual social profiles. By doing this, we aim to determine the influence of the social context on decision-making processes that derive from organizational legitimacy perceptions. Through data collected from a sample of 258 individuals, we relate five individual characteristics to four business legitimacy typologies using regression analysis techniques. Results show that individuals with higher social consciousness are prone to make decisions about organizations that take into account moral and regulatory legitimacy perceptions. However, low-trust customers and customers with high decision visibility are more likely to assess organizations based on cognitive and pragmatic legitimacy considerations.

KEYWORDS:

• legitimacy
• organizational legitimacy
• social context
• decision
• legitimacy evaluation
• types of legitimacy
• sources of legitimacy