John Adams asserted that employees seek to maintain equity between the inputs that they bring to a job and the outcomes that they receive from it against the professed inputs and compare them to outcomes of others. This theory is also considered as one of the justice theories. Equity is measured by comparing the ratio of contributions in terms of costs and benefits in terms of rewards for each person. As an example of equity theory, if an employee learns that a peer doing exactly the same job as him is earning more money, he may choose to do less work, thus feeling justified in his own eyes.Įquity theory focuses on influencing whether the distribution of resources is fair to both relational partners – the employer and employee. In simple terms, equity theory states that if an individual identifies an inequity between himself and a peer, he automatically will adjust his working style to make the situation fair in his own eyes. Equity Theory is based on the idea that individuals are motivated by justice.
For instance, if someone frequently tells lies, his/her disruptive behavior affects coworkers’ morale and productivity.
When people exhibit inappropriate behavior in the workplace, everyone suffers. Adam’s Equity Theory, also known as the Equity Theory of Motivation, was developed in 1963 by John Stacey Adams, a Belgian psychologist known for workplace behavior.