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An increasing amount of literature is concerned with information technology (IT) implementation with regard to interfirm relationships. Some researchers have found an insignificant correlation between IT usage and interfirm relationships. This study sheds light on the reason for such conclusions. To explore the impact of IT usage on collaborative business relationships, the authors have developed a socio-economic model including three important mediating variables: transaction costs, trust, and interdependence. The findings show a direct but insignificant effect of IT on the collaborative business relationship, highlight the importance of the mediating variables, and demonstrate that collaboration is not synonymous with IT usage. Successful collaboration is the result of human interactions, which, in a modern business context, are increasingly supported by IT. Nonetheless, IT usage is not the whole picture. Another important finding of this research is the significant impact trust has on the reduction of transaction costs, thus elevating the level of our understanding regarding the economic benefit of trust in the business environment.
