This chapter argues that there is a basis for rethinking equity theory and that such an enterprise is a worthwhile. Perceptions of equity and justice and their implications. If the employee is able to find his or her right balance it would lead to a more productive relationship with the management. However, studies have found that there s a higher rate of jobhopping, which seems like a contradiction fallick et al, 2006. The theory of equity has been highlighted in the literature after the seminal work by adams. Manual for the minnesota satisfaction questionnaire. Managers widely accept goal setting as a means to improve and sustain performance dubrin, 2012. Equity theory states that employees need a sense of equity in the workplace in order to maintain psychological balance. Reviews of the literature have tended to describe justice as the perceived fairness of decision events e.
Briefly, they subscribe to the norm of equity and feel distress when either overrewarded or underrewarded. Equity theory and performance applied social psychology asp. Although equity is typically viewed as the most appropriate allocation. Workers inputs and outputs are considered in equity theory. Equity theory and performance applied social psychology. Pdf equity theory is the theory relating to justice. Adam theory is the theory underlying the development of theories further. The equity theory owes its origin to several prominent theorists. Considered one of the justice theories, equity theory was first developed in the 1960s by j. Martineztur, peiro, ramos, and moliner 2006 noted a reemergence of interest in equity theory, particularly in the area of market. Equity theory is a conceptualization that focuses on the causes and consequences of people s perceptions of equity and inequity in their relationships with others. Unjust enrichment and the patenting of human genetic material debra l. Equity theory is used in parlance of human resource management. Equity theory is a conceptualization that focuses on the causes and consequences of peoples perceptions of equity and inequity in their relationships with others.
A reactive theory of justice focuses on people s attempts either to escape from or to avoid per ceived unfair states. Equity theory, popularly known as adams equity theory, aims to strike a balance between an employees input and output in a workplace. Moorman s 1991 study had a lasting impact on the justice literature in two respects. Adams equity theory, a powerful theory of motivation toolshero. Adams equity theory builds on maslow s hierarchy of needs and herzberg s two factor theory, and was first presented in 1963. Journal of management education leeds school of business. According to equity theory, it is the perception of equitability and inequitability. The diagonal model of job satisfaction and motivation. The theory is based on the idea that people are motivated by the ratio of inputs and outputs they receive in comparison to others. Stacy adams in 1963 and fully developed in a chapter published 2 years later, equity theory draws on earlier social psychological concepts inspired by fritz heiders balance. Homans s 1961 theory of distributive justice, and adams s 1965 and walster et al. The pros and cons associated with the equity theory the. Greenberg and colleagues reassigned employees to offices of either higher, equal, or lower. The negative rewards lead to obviously a less motivated employee.
This sense of procedural justice is connected to due process u. Free riders as a blind spot of equity theory 241 assessing the predictiveness of equity theory in evoking the concept of the relative outcometoinput ratio, cet sketches the psychological computational processes that members must experience in order to judge the fairness of their exchange relationship with their organization. Adams equity theory, which stresses the importance of striking a balance between employee inputs and outputs. This process is experimental and the keywords may be updated as the learning algorithm improves.
The equity theory of motivation how to keep your team. Equity theory and its applications in the various spheres. Determinants of perceived fairness of performance evaluations. Cons it may lead to under rewarding and these members. Test of equity theory by controlling for comparison coworkers efforts. Conversely, an individual will be demotivated if they perceive unfairness. The utility of equity theory in enhancing organizational effectiveness introduction what motivates people to work. Stacey adam s formulation of the theory which is most highly developed and researched statement on the topic.
Outcomes in a work context might take the form of wages, social approval, job security, promotion and career opportunities, while inputs would include education, training, experience and effort. Equity works like a system with inputs and outputs. Abstract this study examines the concept of equity theory, its intention, and core hypothesis. Equity theory will help hrd explain employees behavior and. Perceptions of equity and justice and their implications on. Output can be things like salary, recognition, and responsibility. The purpose of this study was to assess whether equity theory applied to situations where employees experienced inconsistencies between their job status and work area redmond, 2010. Equity theory is a concept in industrialorganizational psychology that focuses on an individual s perceptions of how equitably they are being treated in their work organization. This chapter argues that there is a basis for rethinking equity theory and that such an enterprise is a worthwhile precursor to further research on the psychology of injustice. Sep 25, 2016 since research on equity theory had previously studied pay, greenberg 1988 wanted to study workplace status as an outcome of equity theory. Equity theory and job satisfaction in silicon valley scholarship. The authors decompose equity theory into its component parts, evaluating related crosscultural research to determine how culture would influence the operation of the theory. Equity theory is a theory of justice related to the ratio between the output eg, reward and input contribution as compared with the ratio of someone else. Equity theory andsiliconvalley 2 abstract silicon valley is known for its amazing workspace and perks.
Adam s 1965 equity theory describes what equity is in relation to a system. First, it helped to establish citizenship behavior as the most common behavioral outcome in the jus. Equity theory, popularly known as adam s equity theory, aims to strike a balance between an employee s input and output in a workplace. This paper presents an alternative to the predominant equity theory for studying the concept of fairness in social relationships. The distribution of rewards and resources is a universal phenomenon that occurs in social systems of all sizes, from small groups to whole societies parsons, 1951. In the field of equity accounting theory related to fairness associated with the. It s about the balance between the effort an employee puts into their work input, and the result they get in return output. I will follow a line of investigation on equity theory in regard to its fundamental importance to organizations since it is assumed to be one of. Equity theory and its applications in the various spheres of life. An employee compares his or her job s inputs with an outcomes ratio. That is, equity theory is based on inequity from the employee s perspective, and in many cases, the inequity is not real.
However, the same was not true for the equity factor. This theory of motivation states that positive outcomes and high levels of motivation can be expected only when employees perceive their treatment to be fair. The equity theory of motivation how to keep your team motivated. Higher is individual s perception of fairness, greater is the motivation level and vice versa. Greenberg, faculty of management and human resources, ohio state.
High status job title as compensation for underpayment. The equity theory of motivation describes the relationship between the employee s perception of how fairly is he being treated and how hard he is motivated to work. As a universal phenomenon in the entire social system sizes, ranging. Equity theory in some sense is related to motivationhygiene theory, in that it considers both demotivators and motivators. Equity theory is a study of human perception in terms of proportionate equivalence of the ratio of one person s inputs to the results. The members will be rewarded according to their effort, which will be fair. Equity theory and its effect on performance outcome sultan gashgari. Equity theory proposes that individuals estimate the ratio of what has been contributed i. Equity theory has a one major proposition which is the comparison of one s inputs and outcomes to others inputs and outcomes and as a result of this comparison one mi ght experience equity or. Greenberg 1988 stated that, according to equity theory, workers. The utility of equity theory in enhancing organizational.
Suc h a findin g is consisten t with the possibility that workers reaction s to their work spaces may be explained by equit y theory. Introduction the complete sequencing of the human genetic code offers numerous opportunities for scientific progress and advancements in medicine. Stacy adams, a workplace and behavioral psychologist, who asserted that employees seek to maintain equity between the inputs that they bring to a job and the outcomes that they receive from it against the perceived inputs and outcomes of others adams. Boston university susan gore university of massachusetts at boston jennifer gordon university of massachusetts at boston journal of health and social behavior 2000, vol 41 september. Stacy adams in 1963 and fully developed in a chapter published 2 years later, equity theory draws on earlier social psychological concepts inspired by fritz heider s balance. This may lead to reflections on the valuebased and relative nature of this concept, as well as the ambiguous consequences the perception of inequity can lead. Adams equity theory leadership skills training from. Equity theory of motivation management study guide. Equity theory proposes that individuals who perceive themselves as. The literature surveyed by this study mention employee motivation, job satisfaction and job embeddedness as the. According to adams, equity theory is based on the simple assumption that people want to be treated fairly. An employee compares his or her jobs inputs with an outcomes ratio. Procedural justice is the idea of fairness in the processes that resolve disputes and allocate resources. John stacey adams equity motivation theory allows you to put workplace psychology into action and increase your own or your team s motivation.
It focuses on the individual and his or her immediate social environmentalthough the macroimplications of the theory are explored at various points. Ebook or pdf edited book email encyclopedia article govt. Equity theory procedural fairness equality rule procedural rule distribution rule these keywords were added by machine and not by the authors. Hrd needs to take equity theory under serious consideration when dealing with people whether in cases of administering simple tasks like pay, promotions, and. To understand adam s equity theory in full, we need to first define inputs and outputs. They explore complexities of and questions raised about equity theory via an analysis of this research, including methodological issues and suggestions for future research. This theory was based on the belief that employee effort leads to performance and performance leads to rewards.
Retrived from supportfilesadamsequitymotivationtheory. Greenberg, 1978 have shown that alloca tors do not. Equity theory is used in parlance of human resource. Applying adams equity theory to employee engagement. The case for promoting equity in developing countries 19 4. Organisational justice theory greenberg, 1987 focuses on perceptions of fairness in organisations, by categorising employees views and feelings about their treatment and that of others within an organisation. The equity theory of motivation employee motivation. The core of the equity theory is the principle of balance or equity. Inputs refer to what a person perceives to contribute e. In short, adam s equity theory means that employees will become demotivated if. Perception is a relative term and differs from person to person. When that sense of equity is lacking, dissonance arises within the employee.
Equity theory based strategies for students on overcoming. We might not see it but this theory is applied at every. Although the relationship between procedural justice and expectancy theories is ambiguous, results of a. Due to equity theory and twofactor theory, employees should be content and stay longer. Miles university of georgia equity theory proposes that individuals who perceive themselves as either underrewarded or overrewarded will experience distress, and that this distress leads to efforts to restore equity.
The basic problems of this theory are that it employs a unidimensional. Inputs include all the rich and diverse elements that employees believe they bring or contribute to the job. One aspect of procedural justice is related to discussions of the administration of justice and legal proceedings. Three types of organisational justice theory have been identified in the literature greenberg, 1987.
Get the complete knowledge about equity theory of motivation from myassignmenthelp experts. Pdf licensed under creative common equity theory in. The present article chronicles the history of the field of organizational justice, identifies current themes, and recommends new directions for the future. A reactive theory of justice focuses on peoples attempts either to escape from or to avoid per ceived unfair states. The adams equity theory was developed by the american psychologist john stacey adams in 1963. Looking back over our series, adams equity theory ties in closely with those of maslow and herzberg. Procedural justice refers to the perceived fairness of the process used to make allocation decisions. Although the comparison of the two inputoutcome ratios gives adams s equity theory an objective component, he was clear that this process was completely. As per this motivation theory, an individual s motivation level is correlated to his perception of equity, fairness and justice practiced by the management. The theory is written at the socialpsychological level. The positive rewards lead to a more positive employee who is highly motivated. Applying equity theory to merit pay, compensation would be an input and work would be an output. An empirical test of general strain theory robert h. The pros and cons associated with the equity theory the equity theory is always dependent on the basis of that the group members should be rewarded on the basis of the contribution that they make to the group.
The core of equity is the principle of balance or equity. A historical overview of the field focuses on research and theory in the distributive justice tradition e. The idea of organizational justice stems from equity theory adams, 1963, 1965, which posits that judgments of equity and inequity are derived from comparisons between one s self and others based on inputs and outcomes. Equitytheoryandsiliconvalley 2 abstract silicon valley is known for its amazing workspace and perks. If the employee perceives inequality, he or she he will act to correct the inequity. Following from equity theory s proposition that the magnitude of the inequityresolution efforts will be proportional to the magnitude of the inequity adams, 1965. To explain what is meant by justice organizations, colquitt, greenberg and zapata.
Purchase equity and justice in social behavior 1st edition. Equity and workplace status 607 paid by receivin g a n inappropriatel y high jo b title responded by increasing thei r jo b performance, as predicte d by equit y theory. Pdf the utility of equity theory in enhancing organizational. According to the equity theory, or merit principle, fairness in social relationships occurs when rewards, punishments, and resources are allocated in proportion to one s input or contributions. John th ibaut, namely a social psychology, and lauren walker a professor of law, both of them since the 1970s known as the social psychology. Nov 20, 2018 the adams equity theory was developed by the american psychologist john stacey adams in 1963. Greenberg and zapataphelan 2005 the development of this concept occurred due to the limitations set out adam s equity theory. Adams equity theory, a powerful theory of motivation.
Equity theory deals with human motives and it should have wide applications in understanding organizational behavior. Equity theory proposes that a persons motivation is based on what he or. The distinction is between seeking to redress injustice and striving to attain justice. John thibaut, namely a social psychology, and lauren walker a professor of law, both of them since the 1970s known as the social psychology. However, equity theory takes a less straightforward and more fluid approach than previous models. Equity theory deals with human motives and it should have wide applications in. The utility of equity theory in enhancing organizational effectiveness.
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