What is the meaning of equity theory?
Equity theory is a theory of motivation that suggests that employee motivation at work is driven largely by their sense of fairness. Employees create a mental ledger of the inputs and outcomes of their job and then use this ledger to compare the ratio of their inputs and outputs to others.
Why is the equity theory important?
Equity theory refers to the give-and-take synergy between employee and employer. Understanding equity theory is critical because it explains how employees demonstrate their side of the equation and how an organization can overcome equity problems in the management of personnel.
What do you mean by equity theory of motivation?
The equity theory of motivation is the idea that what an individual receives for their work has a direct effect on their motivation. When applied to the workplace, it means an individual will generally aim to create a balance between what they give to the organization compared to what they get in return.
What is equity theory in organizational behavior?
The Equity Theory of Motivation deals with the way people compare the value of themselves to others in similar work situations based on their inputs and outputs. The theory assumes that people’s motivation in an organization is based on the desire to be treated equally and fairly.
What is equity theory example?
Equity Theory is based on the idea that individuals are motivated by fairness. As an example of equity theory, if an employee learns that a peer doing exactly the same job as them is earning more money, then they may choose to do less work, thus creating fairness in their eyes.
How do you use equity theory?
Equity theory can be a model for measuring how satisfied an employee is in their job. According to John S. Adams, your staff try to keep a balance between how much they give to you (inputs), and what they receive from your business in return (outputs).
What is an example of equity theory?
Who created equity theory?
John Stacey Adams
Adams’ Equity Theory is named for John Stacey Adams, a workplace and behavioral psychologist, who developed his job motivation theory in 1963.
What are the disadvantages of equity theory?
The difference in perception. One of the most important disadvantages of equity theory is that there is a difference in opinion about perception.
What does equity theory stand for?
Adam’s Equity Theory, also known as the Equity Theory of Motivation, was developed in 1963 by John Stacey Adams, a workplace behavioral psychologist. Equity Theory is based on the idea that individuals are motivated by fairness. 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.
What are principles of equity?
The Principles of Equity was the fullest elaboration of Kames’s theory of legal development. Yet it was not really a book of legal philosophy, but a practical work, aimed at an informed legal audience. Although a book primarily about Scottish law, it was written for a legal audience throughout Great Britain.
What is the focus of the equity theory?
Equity theory focuses on determining whether the distribution of resources is fair to both relational partners. It proposes that individuals who perceive themselves as either under-rewarded or over-rewarded will experience distress, and that this distress leads to efforts to restore equity within the relationship.