Making Justice Sense of Local-Expatriate Compensation Disparity: Mitigation by Local Referents, Ideological Explanations, and Interpersonal Sensitivity in China-Foreign Joint Ventures

By Chao-chuan Chen, Jaepil Choi, S. Chi. 2007

165 citations recorded by the source corpus.

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.

Subfields: Communication, Gender Studies, Organizational Behavior and Human Resource Management

View Paper: https://www.semanticscholar.org/paper/8174bb8863f5028ec728f69d7c4a7b8a1d248633

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In Gender Studies

In Organizational Behavior and Human Resource Management

Citations in the corpus

Determinants of the success of international assignees as knowledge transferors: a theoretical framework (2008, background): “International assignees (IAs) in multinational companies (MNCs) have been traditionally depicted as senior managers, representing headquarters as general managers, marketing or accounting executives, assigned abroad for relatively long periods of time (Boyacigiller 1990).”
Cross-cultural organizational behavior. (2007, background): “Across seven nations, Andolsek & Stebe (2004) also found that material job values (e.g., job quality) were more predictive of OC in individualistic societies, whereas postmaterialistic job values (e.g., helping others) were more predictive of OC in collectivistic societies.”
The relationship between perceived compensation, organizational commitment and job satisfaction: the case of Mexican workers in the Korean Maquiladoras (2007, background): “Recognizing that expatriates are also important social referents (Chen et al., 2002), it is likely that the HCW will compare themselves with the expatriates and perceive lower compensation.”
How Important are Shared Perceptions of Procedural Justice in Cooperative Alliances (2005, background): “Prior research has also demonstrated that local managers often judge justice differently than their foreign counterparts, giving rise to disagreements regarding perceived justice ( Chen, Choi, & Chi, 2002 ).”
Job satisfaction among expatriates, repatriates and domestic employees (2005, background): “comparisons (Chen et al., 2002).”
The interaction of expatriate pay differential and expatriate inputs on host country nationals' pay unfairness (2009, background): “Equity theory suggests that outcome (i.e., pay) differentials between HCNs and expatriates should have a substantial influence on local employees’ perception of pay unfairness (Chen et al. 2002).”