Equity theory, Financial Management

Assignment Help:

Equity Theory

This theory proposes that individuals measure their out- comes/input ratio. Equity theory distinguish that inspiration is not the outcome of an absolute calculation but is a relative calculation. If they calculate that others are getting more outcomes (salary, success) for the same input (effort) they perceive in equality. When people perceive an imbalance in their out- come/input ratio, tension is build up which gives a basis for motivation as people strive for perceived equity and fairness. Based on equity theory in conditions of perceived inequity employees can be predicted to make one of various choices. They can change their inputs (decrease effort), they can change their output (increase productivity), or reframe the conditions (distorting perceptions by changing referent other). Equity theory is not restricted to finance. It has been shown that job titles as well as office space and selection for project groups may also function as outcomes for some employees in their equity equation.


Related Discussions:- Equity theory

Which ratios is potential long term bond investor, Which ratios would a pot...

Which ratios would a potential long-term bond investor be most interested in? Explain. Potential and Current lenders of long-term funds, like banks and bondholders, are interest

Determine finance growth and evolution, a) Debentures are a source of exter...

a) Debentures are a source of external long term (loan) finance for which interest is paid to the debenture holder. Debenture holders do not usually have voting or ownership rights

State about the two types of government securities, State about the two typ...

State about the two types of Government Securities There are two types of Government Securities which are offered: Government Floating Rate Bonds which pay a floating rate

Differance between forward start option and a package, 1 Explain the differ...

1 Explain the difference between a forward start option and a package. Outperformance certificates are offered to investors by many European banks as a way of investing in a com

Provisions for paying off bonds, The issuer of the bond has to repay ...

The issuer of the bond has to repay the bondholders the principal by the stated maturity date. This can be repaid by the issuer in one lumpsum payment at the matu

Caselets, caselets of bajaj electronics

caselets of bajaj electronics

Securitization, Securitization -Source of financing whereby an entity's ASS...

Securitization -Source of financing whereby an entity's ASSETS (characteristically mortgage loans, lease obligations or other kinds of RECEIVABLES) are placed in a special purpose

The chinese pension fund system, The Chinese Pension Fund System Mainlan...

The Chinese Pension Fund System Mainland China has a rapidly aging population. This is attributable to two main factors - the one-child policy plus substantial improvements in l

Duration and convexity of mortgage backed security, Duration an...

Duration and Convexity of MBS A graph decpicting the price of the security under study and the interest rates helps in assessing the duratio

Assignment, Discuss the applicability ofan operating cycle in a poultry bus...

Discuss the applicability ofan operating cycle in a poultry business(consider broilers)

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd