What is the focus of Equity Theory?

Equity Theory primarily centers on the principle of fairness in social exchanges, focusing on how individuals perceive their input-to-outcome ratio in comparison to others. This theory posits that individuals seek to maintain equity between their contributions (inputs) and the compensation or benefits they receive (outcomes) relative to others within the same context. When individuals perceive an imbalance—such as feeling they are putting in more effort than others without receiving equivalent rewards—they may experience feelings of injustice or dissatisfaction, which can impact their motivation and engagement.

The emphasis on social equity is crucial because it illustrates how perceived inequities can lead to reduced motivation, altered behavior, or even withdrawal from participation in a given environment, such as the workplace or social groups. Therefore, understanding Equity Theory helps organizations manage employee expectations and promote a fair environment, ultimately improving morale and productivity.