1 Equity Theory (Adams, 1963; Landy, 1989; Beehr, 1996)

2 Equity Theory A version of discrepancy theory of job satisfaction focusing on the discrepancies between what one has on the job and what one thinks is fair - what one should have

3 Equity Theory Social comparison takes place Perceived discrepancies between ratios may produce tension or dissonance Amount of discrepancy corresponds to the amount of tension the individual experiences Amount of tension corresponds to the amount of energy an individual expends to alleviate the discrepancy

4 Equity Theory Inputs - factors considered by the individual that contribute to their work - knowledge, skills and abilities Outcomes -factors considered by the individual to have personal value - money, promotion, praise

5 Equity Theory I/O < I/O (Underpay) 5/10 10/10 Inequity I/O = I/O (Equity) 10/10 = 10/10 I/O > I/O (Overpay 5/10 10/10 Inequity Equity

6 Equity Theory Strengths -predicts behavior in underpayment conditions Weakness -does not predict overpayment conditions -does not account for individual differences impact upon equity