Barnard, M.E. and Rodgers, R.A., National University of Singapore, Singapore
Drawing from principles of reciprocity and exchange theory, this research seeks to broaden the psychological contract paradigm from one that concentrates on perceptions of an individual party to one that analyzes bilateral mutuality, i.e., the extent to which one party is able to influence the behaviors of the opposite party. Using data from questionnaires completed by 1999 nurses and corresponding questionnaires and performance appraisal reports completed by 338 supervisors, structural equation models were used to analyze the degree to which the expectations and contributions of one party (employee or supervisor) influenced the contributions of the opposite party. The evidence suggests that neither party's understanding of what it needs to contribute to the opposite party was influenced to a significant degree by either the opposite party's demands or contributions. What emerged instead was a consistent and strong relationship between what each party expected to receive from the opposite party and what that same party felt obligated to contribute, i.e., self- referent reciprocity. Contributions to the exchange thus appear to be driven primarily by the benefits that each party hopes to derive from the exchange, and not by gratitude or the obligation to reciprocate for the contributions of the opposite party. Evidence further suggests that initiatives that reduce employees' expectations regarding the benefits they are entitled to receive may have the undesirable effect of undermining employees' perceptions of what they are obligated to contribute resulting in lower employee performance.