Money changes people's ideas about what's fair

Written by: Super Admin
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Washington, Dec 10 (ANI): Want to reward your marketing department for achieving the sales target? Well, make sure you don't make cash part of the pay-off, suggests a new study.

The study has shown that when it comes to distributing resources, people's ideas about what's fair change depending on what's being handed out.

If it's something that has its own intrinsic value - in-kind goods such as food or vacation days - people are more likely to see equal distribution of such items as fair.

However, if it's something that is only valuable when it's exchanged - such as money or even credit card reward points - ideas of fairness shift to a more market-based attitude.

In that case, the thinking is that people should receive according to what they've contributed.

"The paper shows that it is the property of money being a medium of exchange. When you allocate something that only has its value in what it can be exchanged for, that is what activates a market mindset and really invokes these strong norms about input and effort leading to reward," Sanford DeVoe from University of Toronto.

The findings have applications for how companies cope with negative situations too.

A firm that wants to cut costs might consider giving employees all the same time off rather than making equal pay cuts across the board that could potentially lead to disgruntlements from a sense of unfairness.

The study is to be published in an upcoming issue of Psychological Science, a journal of the Association for Psychological Science. (ANI)

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