What is Equity or Equity Theory?
Equity or Equity Theory is a social exchange theory that explains how people attempt to maintain fairness and equity in relationships. The underlying assumption behind this theory is that people have a need to feel that they are being treated equitably. That is, people value fairness.
According to this theory, people form perceptions about the equity or fairness of relationships when they compare the inputs they make to their relationships with the outputs they receive. People calculate an exchange ratio that represents the overall fairness of the exchanges. If a person perceives that they are not getting a fair deal, they become distressed and are likely to try to restore equity.
Original Developments
Equity or Equity Theory was originally developed by John Stacey Adams in the 1960s. Adams suggested that people strive to maintain a balance between inputs and outputs that are proportionate. If someone feels that their inputs are greater than their outputs (e.g., they are working more hours, but not getting paid any more money), they feel like something is not fair.
Adams argued that people experience both positive and negative emotions when their exchange ratio is inequitable. When a person feels like the rewards they are receiving are less than what they are putting in to the relationship, they experience negative emotions like frustration or resentment. On the other hand, when a person feels like their rewards are greater than what they are contributing, they experience positive emotions like satisfaction or pleasure.
The Meaning of Equity
Equity does not necessarily mean exactly equal. It does not mean that every person in a relationship should get the same amount of rewards for the same amount of input. Instead, equity means a sense of fairness, where each person is satisfied with the exchange ratio they are getting.
For example, two people might both work the same amount of hours per week in a job, but one person might be getting paid significantly more money than the other. This could be considered equitable if the person is more highly educated or more experienced and feels like they are getting rewards that are commensurate with their inputs.
Implications of Equity Theory
Equity Theory suggests that people evaluate the fairness of their relationships on a constant basis. This means that relationships need to be carefully managed in order to maintain equilibrium. If inequities arise, people may experience negative emotions that could harm the relationship or lead to the dissolution of the relationship altogether.
Equity Theory has implications for a variety of relationships, such as those between employers and employees, roommates, and romantic partners. Regardless of the type of relationship, this theory suggests that people will strive for a sense of fairness in the exchanges that take place. If a sense of inequity is felt, people may take steps to restore balance.
Conclusion
Equity or Equity Theory is a social exchange theory that suggests that people strive to maintain equilibrium and fairness in the exchanges that take place in relationships. The theory suggests that people calculate an exchange ratio to determine the fairness of their relationships, and if inequity is perceived, people may experience negative emotions and take steps to restore balance. This theory has implications for many types of relationships, including those between employers and employees, roommates, and romantic partners.
