Final answer:
Equity theory is a motivation theory that explains how employees respond to situations in which they feel they have received less (or more) than they deserve. It emphasizes the importance of perceived fairness and equality in the workplace.
Step-by-step explanation:
Equity theory is a motivation theory that explains how employees respond to situations in which they feel they have received less (or more) than they deserve. According to equity theory, employees compare their own inputs (such as effort, skill, and experience) and outcomes (such as pay and recognition) with those of their colleagues. If they perceive an inequity in this comparison, they may be motivated to restore equity by adjusting their inputs or outcomes.
For example, if an employee believes they are putting in more effort and receiving less compensation compared to their colleagues, they may feel demotivated and may try to negotiate for a higher salary or seek alternative job opportunities.
Equity theory highlights the importance of perceived fairness and equality in the workplace, as it has a significant impact on employee motivation and job satisfaction.