Motivation is fundamental to the task of management. Required: What is meant by the ‘equity theory’ of motivation?

Equity theory focuses on the feelings of the individual and how fairly they feel they have been treated in comparison with treatment received by others. It is sometimes referred to as exchange theory; individuals expect certain outcomes in exchange for certain efforts and contribution to the organisation. When an individual perceives that his or her efforts are equal to others and the rewards are the same, then equity exists. If the perception is that the efforts and rewards of one person are unequal to others, then there is inequity



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