Equity theory is based on the idea that individuals are motivated by fairness. Equity theory of motivation equity theory was developed by james stacy adam. Adams equity theory, a powerful theory of motivation. Theory and research 1st edition by elaine walster author, g. Equity theory is based on a principle that peoples actions and motivations are guided by fairness and that discrepancies in this fairness in the workplace will spur them to try and redress it. Equity theory proposes that human beings love and appreciate. Equity theory implications crosscultural and historical researchers have long been interested in the impact of culture on perceptions of social justice. Basically this means that we judge our investment and input in our relationships with. According to equity theory, it is the perception of equitability and inequitability. Equity and equality is horizontal equity he the most widely accepted principle of equity. The adams equity theory posits that people maintain a fair relationship between the performance and rewards in comparison to others. The equity theory owes its origin to several prominent theorists. Equity theory focuses on determining whether the distribution of resources is fair to both. Equity theory states that a persons motivation is based on what they believe is fair or not fair compared to others pennsylvania state university, 2016.
If the employee is able to find his or her right balance it would lead to a more productive relationship with the management. Pdf equity theory and interpersonal attraction researchgate. The equity theory of motivation employee motivation. The relevance of scientific management and equity theory. Learn vocabulary, terms, and more with flashcards, games, and other study tools. It explains why a promotion or raise rarely has the desired effect. Inputs include all the rich and diverse elements that employees believe they bring or contribute to the job. Or does it stand in opposition to the advancement of human welfare. It is a cognitivecentered theory as it is basically concerned with the person himself, his. Considered one of the justice theories, equity theory was first developed in the 1960s by j. Higher is individuals perception of fairness, greater is the motivation level and vice versa. Equity theory, as developed by adams 1965, considers motivation and job satisfaction as the result of a comparison of a workers perceived. This paper discusses and describes the equity theory of motivation with its implications to managers in the light of a real organizational example. The companies involved in these transactions are typically mature and.
The equity theory of motivation describes the relationship between the employees perception of how fairly is he being treated and how hard he is motivated to work. An employee compares his or her jobs inputs with an outcomes ratio. Like other theories, equity theory is also not free from criticism. Equity theory was first developed in the year 1960 by a psychologist by the name john stacy, who affirmed that workers or employees try to maintain equity between what they offer or put into a job and what they get or receive from it against the inputs and outputs of other people.
Equity theory comes under process theory which gives the perception whether the individual is going to work hard or not depending upon the rewards and possible outcomes. The utility of equity theory in enhancing organizational effectiveness introduction what motivates people to work. Equity theory adams, 1963, 1965 draws from exchange, dissonance, and social comparison theories in making predictions about how indi viduals manage their. The theory is also known as adams inequity theory of motivation. Toward a resolution of the negativeinputs controversy article pdf available in personality and social psychology bulletin 32. It was published in the journal, experimental social psychology, 1965, new york titles inequality in social exchange. The utility of equity theory in enhancing organizational effectiveness article pdf available in european journal of economics, finance and administrative sciences march 2012 with 17,394 reads. High performance is achieved by well motivated people who are prepared to exercise discretionary effort. Equity theory of motivation examples explained hrf. Equity theory is based on the premise that employees will put forth a particular level of effort that they feel compares to the reward potential. And in motivation for employees, we have equity theory which is one of the most popular motivation theories in managing and motivating employee performance. The adams equity theory shows why salary and benefits alone dont determine an employees motivation.
Equity theory is used in parlance of human resource management. Adams equity theory leadership skills training from. If there are unequal levels of input or output, either internally or within an observed group, then adjustments are made to create more fairness. Developed by the behavioral and workplace psychologist, john stacy adams, equity theory of motivation is one of the justice theories explaining the correlation between input and outcome of performance of employee at a job with hisher perception of equitable or inequitable behavior from the employers. The core of equity is the principle of balance or equity. Equity theory focuses on determining whether the distribution of resources is fair to both relational partners.
A funny way to understand equity theory is through the video below. Find all the books, read about the author, and more. Individual rewardsindividual inputs others rewards others inputs. Equity theory will help hrd explain employees behavior and provide them with the possible factors that might decrease efficiency and performance. It can be used in personal life, government or business. Introduction to equity theory first developed in 1963 by john stacey adams 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. Archived from the original pdf on 23 september 2015. While equity theory is a significant step forward, the theory itself needs further specification. As per this motivation theory, an individuals motivation level is correlated to his perception of equity, fairness and justice practiced by the management.
Stacey adams formulation of the theory which is most highly developed and researched statement on the topic. When applied to the workplace, equity theory focuses on an employees workcompensation relationship or exchange relationship as well as that employees attempt to minimize any sense of unfairness that might result. The utility of equity theory in enhancing organizational. Pdf the relevance of scientific management and equity. This paper proposes equity theory as a guiding aid in ph. Under the proprietary theory, the entity is the agent, representative, or arrangement through which the individual entrepreneurs or shareholders operate.
Adams 1965 developed a theory on motivation to attempt to explain behavior influenced by the norm of equity lane, irving m. A motivation is the force that energizes, directs and sustains behavior. One aspect of equity theory asserts that demotivation occurs if employees. The core of the equity theory is the principle of balance or equity. Equity theory plays a role in analyzing organizational behavior. Equity, or more precisely, inequity is a major concern of industry. It can even undermine the motivation of other employees. Get the complete knowledge about equity theory of motivation from myassignmenthelp experts. Equity theory proposes that peoples motivation, performance and satisfaction depend on their subjective evaluation of the relationships between their effortreward ratio and the effort reward of others in similar situations. Equity theory criticisms a number of demographic and psychological variables affect peoples perception of fairness and interactions with others people might perceive equity inequity not only in terms of the specific inputs and outcomes of a relationship, but also in terms of the system that determines those inputs and outputs not everyone. Adams asserted that when people feel distress from inequity they may react in one or all of the following ways. The following points highlight the top five theories of equity.
The equity theory of motivation how to keep your team. In other words, an employee gets demotivated by the job and his employer in case his inputs are more than the outputs. Concept that people derive job satisfaction and motivation by comparing their efforts inputs and income outputs with those of the other people in the same or other firms. The equity theory of motivation is comprised of four widely accepted tenants. 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. Equity theory of motivation management study guide. This paper argues that the case for the he principle is not as straightforward as is usually thought and that it. Stacy adams, a workplace and behavioral psychologist, who asserted that. It is centered around a costbenefit analysis of any given relationship. Equity theory, as developed by adams 1965, considers motivation and job satisfaction as the result of a comparison of a. First, they may restrict their inputs to a level they believe is. The equity theory, is based in the idea that individuals are motivated by fairness, and if they identify inequities in the input or output ratios of themselves and their referent group, they will seek to adjust their input to reach their perceived equity. Equity theory is a concept of human relations based on utility, or the amount of happiness and satisfaction one gets out of any given relationship. One criticism of hiring friends or the encouraging of making friends on the job is that.
According to carrell and dittrich 1978, employees who perceive inequity will seek to reduce it, either by distorting inputs andor outcomes in. Equity theory has received more attention lately from human resource professionals especially regarding the fairness of outcomes. In simple terms, equity theory states that if an individual identifies an inequity between themselves and a peer, they will adjust the work they do to make the situation fair in their eyes. Equity theory, popularly known as adams equity theory, aims to strike a balance between an employees input and output in a workplace. Employees place great importance on being treated fairly and equally.
Process theories of motivation equity theory business essay. Criticism has been directed toward both the assumptions and practical application of equity. As an example of equity theory, if an employee learns that a peer doing. This essay seeks to characterise the essential features of an equitable health care system in terms of the classical aristotelian concepts of horizontal and vertical equity, the common but illdefined language of need and the economic notion of costeffectiveness as a prelude to identifying some of the more important issues of value that policymakers will have to decide for themselves. To further illustrate equity theory considerations, a.
The research supports equity predictions in the area of underpayment, but the overpayment effects have not been satisfactorily demonstrated. Criticism to equity theory directed towards both the assumptions and. Read this article to learn about the equity theory of motivation and its evaluation. Equity theory based strategies for students on overcoming. Equity theory proposes that a persons motivation is based on what he or she considers to be fair when compared to others redmond, 2010.
According to the theory, employee motivation is the result of the balance between what an. It has been accepted for inclusion in scripps senior theses by an authorized administrator of scholarship. Miles university of georgia equity theory proposes that individuals who perceive themselves as either underrewarded or overrewarded will experience distress, and that. The relevance of scientific management and equity theory in everyday managerial communication situations article pdf available in journal of management policy and practice 3. Motivating employees with limited pay incentives using equity. Equity theory suggests that individuals who perceive themselves as either underrewarded or overrewarded will experience distress, and that this distress leads to efforts to restore equity within the relationship. 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. Equity and equality iza institute of labor economics. Adams equity theory, which stresses the importance of striking a balance between employee inputs and outputs. According to this theory of motivation, an individuals motivation level is connected with his perception of equity, fairness and justice practised by management. This paper concentrates on equity theory as it is conceived by adams. They contend that culture exerts a profound impact on how concerned men and women are with fairness and equity and on how fairness is defined, especially in the realm of gender relationships. John stacey adamss equity theory has been a part of classical management literature since 1963. Pdf recent exchanges in the bulletin have attempted to resolve difficulties in the possibility of negative inputs in the defini tions of equity.