Equity theory suggests that employees compare their job inputs (i.e., effort, experience, education, competence, creativity) and outcomes (i.e., salary levels, raises, recognition, challenging assignments, working conditions) with those of others. We perceive what we get from a job situation (the outcomes mentioned above) in relation to what we put into it (the inputs mentioned above), and then we compare our outcome-input ratio with the outcome-input ratio of relevant others. (This idea is illustrated in Exhibit ...) If we perceive our ratio to be equal to that of the relevant others with whom we compare ourselves, a state of equity is said to exist. We perceive our situation as fair—that justice prevails.
When we see the ratio as unequal, we experience this as inequity.
Imagine that you wrote a case analysis for your marketing professor and spent 18 hours researching and writing it up. Your classmate spent 6 hours doing her analysis. Each of you received a mark of 75 percent. It is likely that you would perceive this as unfair, as you worked considerably harder (i.e., exerted more effort) than your classmate. J. Stacy Adams has proposed that those experiencing inequity are motivated to do something to correct it. Thus, you might be inclined to spend considerably less time on your next assignment for your marketing professor.
