Making Justice Sense of Local-Expatriate Compensation Disparity in China-Foreign Joint Ventures: The Role of Ideological Explanations and Interpersonal Sensitivity
Journal
Academy of Management Journal
Journal Volume
45
Journal Issue
4
Pages
807-817
Date Issued
2002
Date
2002
Author(s)
Abstract
We examined how local employees of international joint ventures (IJVs) perceived disparity between their compensation and foreign expatriates' compensation from equity theory and social justice perspectives. Chinese locals perceived less fairness when comparing their compensation with expatriates' than when comparing it with other locals'. However, fairness vis-a-vis expatriates increased if the locals were compensated higher than their peers in other IJVs or endorsed ideological explanations for expatriates' advantage. Furthermore, expatriates' interpersonal sensitivity toward locals reduced the effect of disparity on perceived fairness. Finally, perceived compensation fairness was related positively to compensation satisfaction but negatively to intentions to quit.
Type
journal article
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