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The sources of trust: An empirical study of trust and suspension in the Arve valley industrial districtStrong trust based relationships are one of the pillars of the communitarian model of industrial districts. District literature calls upon trust in order to explain several elements of the model. The existence of trust may explain how a highly fragmented and essentially local value chain reduces transaction costs compared with an integrated firm. It may also allow for closer ties where up to date pertinent information and innovative ideas are transferred between firms. Trusting, long term relationships and district networks are also evoked in the literature as being, in themselves, sources of competitive advantage. Yet despite large sections of district literature calling upon trust to explain the existence and efficiency of industrial districts, few scholars have investigated empirically the sources of trust in local ties. In depth semi-directive interviews with small firm managers in the Arve Valley industrial district near Geneva were analysed in order to examine the context and quality of intra-district relationships (mainly supplier and peers) which were then ompared with extra-district links with clients. The sources of trust are analysed by applying Möllering’s (2006) model of trust based on reason, routine and reflexivity. Findings indicate that managers rely more on a rational calculation of partner’s motives than ‘blind’ adherence to local, historical norms of behaviour. This finding contributes to the view that districts are organizational fields where agents possess large amounts of information about markets, technologies and partners. Managers also demonstrate a willingness to maintain local links over the long term, thus ensuring a crucial element of their firms’ competitive advantage and will adjust their behaviour accordingly. This thesis contributes to district literature by examining detailing the existence and foundations of close intra-district ties created between managers mobilising resources based on cognitive, organisational and geographical proximities. A major contribution to trust literature is the 5 analysis and discussion of the complex interplay between the three antecedents outlined in Möllering’s model in the creation of local trust and proposes that while trust decisions in information rich districts are based more on rational calculation than on local norms and institutions, other trust decisions (with external clients), in the absence of sufficient information are founded on very different bases. This comparison of the foundations of trust in two different contexts highlights the role of identity and routine in the ‘leap of faith’ or suspension of doubt that is trust.