REWARD ALLOCATION AND CULTURE A Meta-Analysis

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10.1177/0022022103251753 JOURNAL OF CROSS-CULTURAL PSYCHOLOGY Fischer, Smith / REWARD ALLOCATION

Article

REWARD ALLOCATION AND CULTURE A Meta-Analysis RONALD FISCHER Victoria University of Wellington PETER B. SMITH University of Sussex

A meta-analysis is reported of those cross-cultural reward allocation studies in which the allocator was not a recipient of the allocation. Results from 25 studies in 14 different cultures were included. Previous narrative reviews of the literature have used individualism-collectivism as an explanatory framework. However, it was found that Schwartz’s hierarchy and Hofstede’s power distance dimensions account best for crosscultural differences in reward allocation. Individualism-collectivism was not related to effect size. Study designs and participants sampled (students versus employees) were identified as moderator variables. The findings are discussed in terms of theoretical and practical implications for cross-cultural research. Keywords: equity theory; reward allocation; distributive justice; individualism-collectivism; meta-analysis

Over the last 20 years, numerous studies have found cross-cultural differences in reward allocation behavior. The way of distributing rewards is an important motivational tool in work organizations (Erez & Earley, 1993), and cross-cultural differences would therefore have important implications for the increasingly global operation of companies. Consequently, various scholars have tried to summarize and combine these results in narrative reviews (Erez & Earley, 1993; Erez, 1994, 1997; James, 1993; Leung, 1997; Smith & Bond, 1998). However, narrative reviews have been criticized for neglecting large amounts of data contained in primary research reports and for being less reliable than alternative techniques such as meta-analysis (Bangert-Drowns, 1986; Cooper & Rosenthal, 1980). This study therefore provides a quantitative review of previous cross-cultural research on reward allocation, focusing on studies relevant for organizational contexts in which the allocator is not a recipient of the allocation. It also examines the impact of culture-level value dimensions on allocation behavior, identifies possible moderator variables, and highlights shortcomings and inconsistencies in previous research. Before describing the methods used in this study, a brief summary of the theoretical and methodological approaches employed by previous researchers in this field is provided.

AUTHORS’NOTE: A previous version of this article was presented at the Regional Conference of the International Association for Cross-Cultural Psychology in Winchester, UK, July 2001. We are grateful for valuable comments by Charles Harb, Dianne van Hemert, Diane Sunar, Yoshihisa Kashima, and Rod Bond on earlier drafts. JOURNAL OF CROSS-CULTURAL PSYCHOLOGY, Vol. 34 No. 3, May 2003 251-268 DOI: 10.1177/0022022103251753 © 2003 Western Washington University

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PREVIOUS RESEARCH ON REWARD ALLOCATION Early researchers focused almost entirely on differences concerning reliance on the principles of equity and equality (Bond, Leung & Wan, 1982; Leung & Bond, 1984). More recently, researchers have included additional principles, such as need (Berman, MurphyBerman & Singh, 1985; Berman & Murphy-Berman, 1996; Giacobbe-Miller, Miller, & Victorov, 1998; Kashima, Siegal, Tanaka, & Isaka, 1988; Murphy-Berman, Berman, Singh, Pachauri, & Kumar, 1984); social skills (Giacobbe-Miller et al., 1998; Lin, Insko, & Rusbult, 1991; Rusbult, Insko, & Lin, 1995) and tenure (Chen, 1995; Hundley & Kim, 1997; Mahler, Greenberg, & Hayashi, 1981; Rusbult et al., 1995).1 The typical reward allocation experiment has been a scenario study describing two or more individuals working on a task with different performance inputs. Most commonly, participants are asked to divide a reward between the individuals described. Students have mostly been used as convenience samples and observed differences found in these studies have generally been explained post hoc in terms of differing levels of individualism-collectivism found in previous culture-level studies, particularly that by Hofstede (1980). After reviewing cross-cultural reward allocation studies, James (1993) concluded that individualists follow equity regardless of the group membership of their interaction partner, whereas collectivists are more likely to use equality when interacting with an in-group member but to allocate rewards equitably with outgroup members even more strongly than would individualists. Smith and Bond (1998) drew similar conclusions in their review. Focusing on self-construals rather than on individualismcollectivism, Erez and Earley (1993) conclude that individuals with interdependent selfconstruals would behave like collectivists by showing greater concern for equality with ingroup members and by using equitable allocations toward out-group members. In a recent refinement of their culture-based model of work motivation (Erez, 1994), a vertical dimension similar to power distance (Hofstede, 1980) is considered along with individualism-collectivism to explain the results from previous research. Power distance refers to the acceptance of unequal distribution of power within societies (Hofstede, 1980). Schwartz (1994) used the labels of Hierarchy versus Egalitarianism to describe a similar cultural dimension. However, reliance on culture-level dimensions when explaining observed differences post hoc is open to criticism. Hofstede (1980) highlighted the problem of the ecological fallacy. The assumption for these comparisons is that the cultural orientation of the individuals in the sample would correspond to the scores for their respective home nation. However, these culture-level scores represent averages across those individuals who responded to his survey. Consequently, within each nation there might be considerable variation and, for example, a Japanese might be more individualistic than a U.S. American when their scores are compared directly. Individual-level variations in cultural orientation are therefore required to explain individual-level cross-cultural differences (e.g., Chen, Meindl, & Hunt, 1997; Chen, Meindl, & Hui, 1998; Hui, Triandis, & Yee, 1991; Leung & Iwawaki, 1988; Tower, Kelly, & Richards, 1997). Noting these and other problems in previous research, Leung (1997) criticized crosscultural reward allocation research for its lack of theoretical and empirical rigor and argued that allocation behavior depends on both situational factors and interactional goals. In his contextual model of reward allocation, he proposed that the role of the allocator is an important moderator variable. If the allocator divides a reward between himself or herself and one or more other partners, the in-group/out-group distinction is important and the commonly

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observed difference between individualists and collectivists is likely to be found (Leung & Bond, 1984). However, if the allocator is not a recipient of an allocation, no cross-cultural differences would be expected and equity should be used in all cultures. The in-group/outgroup dimension is not expected to have relevance in this context. Because this latter type of allocation is the typical form of allocation used in real organizations, conclusions drawn from this research can have important practical implications for managers and practitioners working in organizational settings. The aim of the present study is therefore to review crosscultural reward allocation studies where the allocator is not a recipient, using quantitative meta-analytical procedures. The present analysis addresses three main research questions. First, we test whether there are reliable cross-cultural differences across the studies that we located. Second, various moderator variables are examined. Researchers into reward allocation have employed different methods and various statistical techniques, which makes it difficult to compare results across studies. We therefore test whether the research and data-analysis methods used influence effect sizes. Furthermore, although students were often used as convenience samples, the results of some studies have suggested that students and working adults prefer different allocation principles (Giacobbe-Miller et al., 1998; Tornblom & Foa, 1983; Wagstaff, 1997). We therefore test whether students and employees differ in their reward allocation preferences. Finally, we investigate whether study outcomes covary with any of the cultural value dimensions identified in previous culture-level research (Hofstede, 1980; Schwartz, 1994).

METHOD LITERATURE SEARCH

A search for relevant studies was conducted using PsycINFO covering the period 1967 to March 2001. The keywords used were equity theory, reward allocation, and distributive justice. A request was also sent to the mailing list server of the International Association of Cross-Cultural Psychology to help with identification of unpublished or unavailable studies. Finally, we drew on reference lists in various prior reviews of the literature (Erez, 1994, 1997; Erez & Earley, 1993; Leung, 1997; Smith & Bond, 1998) and all the studies located were consulted. The criteria for inclusion were that (a) the allocator was not a recipient of the allocation, (b) two or more cultural groups were compared in the analysis, (c) participants were adults (i.e., at least 17 years of age), and (d) the studies included equity (based on performance or other task-relevant differences) and equality as allocation norms. The studies often included manipulations of other variables, such as additional allocation norms (Chen, 1995; Berman et al., 1985; Berman & Murphy-Berman, 1996; Murphy-Berman et al., 1984), gender (Rusbult et al., 1995), permanence of the allocation (Berman et al., 1985; Murphy-Berman et al., 1984), and positive versus negative allocations (Berman et al., 1985; Berman & Murphy-Berman, 1996; Murphy-Berman et al., 1984). In the present review, only the differences in terms of equity versus equality were considered because there were not enough studies to examine the effects of these additional manipulations. In total, 20 reports including 25 comparisons (23 independent experiments) using a total of 4,903 participants were found. Fourteen countries or cultural groups were included, with 15 different pairs of comparisons (see the appendix).

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COMPUTATION AND ANALYSIS OF EFFECT SIZES

As discussed previously, the studies typically include two independent variables using a between-subjects ANOVA design. The first independent variable is the culture of participants, whereas the manipulation of task input or performance of the described individuals in the scenarios serves as a second independent variable. The interest for the present review is therefore how the interaction between manipulated task performance and participants’country affects the allocation of rewards. The studies varied in the way that they tested for the interaction effect. Most studies reported F values and means. The corresponding effect size measure η2 for interaction effects has undesirable properties (Hedges & Olkin, 1985), and contrasts (Rosenthal & Rosnow, 1985) were therefore performed where possible. The contrasts were crossover interactions, assigning the more individualistic country a positive weight for equity and a negative weight for equality, whereas the supposedly more collectivist country was assigned a negative weight for equity and a positive weight for equality (individualism-collectivism scores based on Hofstede, 1980). A calculated effect size with a positive sign indicates that the participants from the more collectivistic cultural sample preferred equality to equity, whereas individuals from the more individualistic culture preferred equity to equality. A negative effect size indicates that this effect was reversed. Alternative forms that have been used to present results include regression analyses (Bond et al., 1982; Giacobbe-Miller et al., 1998; Hundley & Kim, 1997), differential or equity-equality indices (Chen, 1995; Chen et al., 1998; Mahler et al., 1981), and percentage money allocations (Aral & Sunar, 1977; Berman et al., 1985; Keats & Fu-Xi, 1994; Marin, 1981; Murphy-Berman et al., 1984). Regression analyses test how the manipulation of task input or performance affects the dependent variable (i.e., allocation of rewards) within each cultural group separately. In this case, the effect size was calculated by comparing the slopes of the regressions in the two samples. Studies reporting differential or equity-parity indices combined the results for equity and equality as a single index. Here the effect size was calculated using the standardized mean difference g (Rosenthal, 1994). Finally, the effect sizes for percentage money allocations were computed using Φ (Rosenthal, 1994). Although Φ has some problematic properties (Fleiss, 1994), it was used due to the possibility of converting it into effect size r. Furthermore, the marginal distributions were roughly equal and therefore should not bias results. As recommended by Rosenthal (1991, 1994), all the effect sizes for the allocation of rewards were transformed from r to z using the formula provided by him.2 To keep the results consistent with current conceptualizations of equity theory, only allocations of material rewards were used for the computation of the effect sizes.3 One study (Kim, Park, & Suzuki, 1990) used three cultural samples (United States, Japan, South Korea). Separate effect sizes were obtained for the individual comparisons, creating nonindependence in the data (Hedges & Olkin, 1985). However, it was decided to include them because nonindependent effect sizes do not exert detrimental influence on the results of an analysis (e.g., Bond & Smith, 1996; Dindia & Allen, 1992). For correlations with cultural dimensions, the country-level scores provided by Hofstede (1980) and Schwartz (1994)4 were used. Differences along the various dimensions between the cultural samples in the studies were calculated. Following the calculation of effect sizes, the more individualistic country (mostly United States; Australia in three studies, Japan once) was again used as reference category, and the respective country scores for the other cultural sample were subtracted from the United States/Australia/Japan country mean. This was done for each of the four Hofstede dimensions and for each of the seven Schwartz

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TABLE 1

Summary Statistics for Meta-Analysis Dependent Variable Effects Effects without outliers

N

Samples Weighted

4,165 3,543

21 18

Mean zr SE (zr) .065 .160

.016 .017

Lower 95% CI .034 .127

Upper 95% CI .096 .193

Q 483.67 126.57

NOTE: CI = confidence interval.

dimensions. The four dimensions used by Hofstede (1980) were Individualism-Collectivism, Power Distance, Uncertainty Avoidance, and Masculinity/Femininity. The seven dimensions described by Schwartz (1994) are Intellectual Autonomy, Affective Autonomy, Egalitarian Commitment, Mastery, Harmony, Conservation, and Hierarchy. Hofstede scores were available for eleven of the cultures included in this analysis. Schwartz scores were available for all countries but Colombia. Finally, economic indicators collected from the World Development Report (World Bank, 2000) such as the Gini index of income inequality, Gross Domestic Product Growth (GDP) (1980-1990/1990-1999) and Gross National Product (GNP) and GNP per capita were also used to calculate further difference scores as described above.

RESULTS DESCRIPTIVE STATISTICS

Most studies showed a small but positive effect. Three outliers were found. The two studies comparing employees from the People’s Republic of China with either U.S. (Chen, 1995) or Australian (Keats & Fu-Xi, 1994) working adults had extreme negative effect sizes, whereas the study comparing Swedish and U.S. students (Tornblum, Jonsson, & Foa, 1985) yielded a strong positive effect size. Table 1 shows the overall results with and without these outliers. The mean effect was very small, but significant, and becomes larger when the outliers are removed. According to the standards defined by Cohen (1992) the effect size was small. Consequently, the average effect size does indicate that there are cross-cultural differences in the preferred reward allocation norm. However, the Q statistic was significant (p < .001) indicating that there is substantial heterogeneity of effect sizes even after removing the three studies with extreme results. Potential moderator variables are next investigated. MODERATOR VARIABLES

Several potential moderator variables were examined. First, it was tested whether the method of calculation of effect sizes (contrast, regression, differential indices, percentages) influenced the effect sizes obtained. Second, participants had either been asked to rate whether they preferred equity or equality when allocating various rewards (Chen, 1995; Tornblom et al., 1985) or they had actually been asked to distribute some reward in the form of money, points, promotion recommendations, and so forth. Third, the sample population (students versus full-time employees) was also considered a potential moderator. Finally, we examined whether the effect sizes covaried with cultural characteristics identified in

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TABLE 2

ANOVA Summary for the Presence of Moderator Variables Source Effect of effect size computation Between groups Within groups Contrast Regression Percentages Differential indices Total within groups Effect of design (rating versus allocation) Between groups Within groups Allocation Rating Total within groups Effects of sampling (students versus employees) Between groups Within groups Students Employees Total within groups Overall

Statistic

df

253.90

3

55.89 3.60 33.80 136.47 229.77

9 2 4 2 17

183.95

1

150.49 149.23 299.73

18 1 19

210.99

1

153.36 119.33 272.68 483.67

17 2 19 20

Average Effect Size

SE

.29 .22 –.08 –.28

.02 .04 .04 .03

.15 –.47

.02 .04

.17 –.42

.02 .04

.06

.02

previous culture-level studies (Hofstede, 1980; Schwartz, 1994). Analysis of variance (Hedges, 1994) was used to test the first three sets of moderators. Given the small number of studies in this review, separate analyses for each potential moderator were performed. The covariation of effects with cultural dimensions was tested using weighted correlation. The small number of studies and problems of multicollinearity due to the high intercorrelation of the cultural dimensions precluded regression analyses (Hedges, 1994; Hedges & Olkin, 1985). We first tested whether there were differences in the effect sizes depending on how the results were reported and the effect sizes were calculated. Effects were found to be dependent on the way they were calculated: Q(3) = 253.90, p < .001 (see Table 2). The effect sizes were positive when enough information was available to use contrasts or when regression results were reported. This means that these studies support the often cited result that collectivists prefer equality over equity, whereas individualists are more equitable. There was a small negative effect when percentages were used to calculate effects and a moderately large negative effect when the authors reported the results in the form of a differential index. Therefore, these less frequently referenced studies showed the opposite effect, with collectivists preferring equity somewhat more than equality, whereas the opposite pattern is found for individualists. However, there was still a significant amount of variance unexplained within each group (except in the case of the regression analyses). The next analysis showed that the results differed between study designs: Q(1) = 183.95, p < .001, with rating procedures yielding negative effect sizes and allocations yielding positive effects (see Table 2). Therefore, studies asking participants to allocate some rewards showed a preference for equality over equity in more collectivist samples, whereas studies

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TABLE 3

Calculated Effect Sizes by Population Sampled Students Mean effect (k) Contrasts Frequencies Regression Equity-equality indices

.29 (10) –.04 (4) .21 (2) .01 (2)

Employees Q (Heterogeneity) 55.89 23.29 3.56 0.44

Mean effect (k) — –.49 (1) .23 (1) –.69 (1)

NOTE: k indicates number of studies.

involving rating procedures found the opposite effect, with individualists being more egalitarian than collectivist. Finally, we tested whether students and employees differed in their allocation behavior. There was a highly significant difference between the two groups: Q(1) = 210.99, p < .001, with student samples yielding a small positive effect and studies sampling employees reporting a moderately large negative interaction effect (Table 2). Student samples from more collectivist backgrounds seem to prefer equality more than equity, whereas employees in collectivist cultures clearly prefer equity over equality. There was substantial variance unexplained by the moderators in all of these analyses. A combination of the moderators (calculation of effects and population sampled) did a better job (see Table 3). As can be seen, all but three studies used student samples. The effect sizes within each of the different data analysis groups were homogeneous. This means that studies employing a particular data analysis method with student samples did yield a consistent and homogeneous effect size. The four studies with student samples reporting frequencies (Aral & Sunar, 1977; Berman et al., 1985; Marin, 1981; Murphy-Berman et al., 1984) used students from India, Indonesia, Turkey, and the United States. The two studies using regression analyses with student populations (Hundley & Kim, 1997; Leung et al., 1982) compared Hong Kong Chinese and Koreans with Americans, and the remaining two studies reporting equityequality indices with students (Chen et al., 1998; Mahler et al., 1981) compared Hong Kong Chinese and Japanese with Americans. The two studies using mainland Chinese employees resulted in large negative effect sizes (Chen, 1995; Keats & Fu-Xi, 1994), and the study comparing Russian and American managers (Giacobbe et al., 1998) resulted in a small positive effect. Therefore, there does seem to be some variation of effect sizes according to which nations were sampled, and these associations are explored next. CULTURAL CHARACTERISTICS

The difference scores based on country-level value dimensions provided by Hofstede (1980) and Schwartz (1994) and economic indicators given in the World Development Report (World Bank, 2000) were correlated with the effect sizes. Reported correlations are weighted by sample size. First, one of the economic indicators (the Gini index) showed a meaningful relationship with the sample size weighted effect sizes. The correlation (r = .46; p = .05) indicates that participants from societies with less income inequality allocated rewards more equally, whereas large inequalities lead to more differential rewards. Second, the cultural difference scores were correlated with each other (Table 4) to examine the interrelationship among the dimensions in the particular samples studied. Some

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TABLE 4

Correlations Between Cultural Difference Scores 1 1. Harmony 2. Embeddedness 3. Hierarchy 4. Mastery 5. Affective Autonomy 6. Intellectual Autonomy 7. Egalitarian Commitment 8. Uncertainty Avoidance 9. Individualism 10. Masculinity 11. Power Distance

— .16 –.57** –.70** .15 .75** .41 .29 .40 –.67* –.60**

2

3

4

5

6

7

8

— .04 — .05 .68** — –.13 .20 –.04 — –.42 –.65** –.71** .28 — –.06 –.75** –.62** .10 .50* — .51* .07 –.27 .27 .09 –.12 — .21 –.75** –.25 .48 .41 .79** –.17 –.03 .90** .87** –.79** –.96** –.81** –.19 .20 .84** .96** –.73** –.91** –.72** –.12

9

10

— –.68* –.43

— –.94**

*p < .05. **p < .01.

interesting patterns were found. The table shows highly correlated difference scores for Hierarchy, Harmony, Mastery, Intellectual Autonomy, and Egalitarian Commitment and also for Masculinity and Power Distance. The difference scores for Conservation, Affective Autonomy, and Uncertainty Avoidance were not correlated with other dimensions. Individualism correlated negatively with Hierarchy and positively with Egalitarianism. Consequently, any post hoc explanations in terms of individualism-collectivism would be highly ambiguous because the studies sampled differed in parallel ways along several other cultural dimensions. Any difference attributed to a specific dimension in these samples could equally well be due to any of the other dimensions. Focusing first on the correlations of the sample size weighted effects with the difference scores based on Hofstede (1980) dimensions, there was a significant relationship with Masculinity (r = .56; p < .05) and a marginal association with Power Distance (r = .51; p = .07). Participants from more masculine cultures allocated rewards significantly more equitably than did participants from more feminine cultures. The marginally significant correlation between Power Distance and reward allocation indicated that participants from cultures with greater power differentials allocated rewards more equitably than did those from more egalitarian cultures. However, both these effects disappeared when the effect of income inequalities as measured by the Gini index was partialed out. The relationship between Individualism and the effect sizes was not significant (r = –.44; p = .13) and the direction was also opposite to what would be expected from previous reviews. More collectivist samples preferred equity more strongly than equality. The only significant relationship between cultural difference scores based on the Schwartz (1994) dimensions with the weighted effects was found for Hierarchy (r = .67; p < .01). Increasing Hierarchy within a society is associated with an increasing preference for equity over equality, more positive perceptions of allocators who use equity instead of equality and more differential allocation of material rewards. This corresponds to the relationship found using Hofstede’s (1980) power distance dimension. The relationship remains significant when holding income inequality constant (r = .54; p < .05). Controlling for GNP, GNP per capita, GDP, and the Gini index simultaneously did not affect the finding (r = .67). No other relationship was significant. Consequently, it seems that the Hierarchy dimension is associated with allocation behavior independent of economic inequality or economic development. The dimensions closest to Hofstede’s Individualism-Collectivism dimension are

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Intellectual Autonomy and Conservation (Schwartz, 1994). The correlation between Intellectual Autonomy and equity was in the opposite direction (r = -.36). Participants from cultures which emphasize Intellectual Autonomy less (i.e., are more collectivist) distribute rewards more equitably than participants from cultures higher on intellectual autonomy. This result is consistent with the direction of the effect found with Hofstede’s Individualism dimension.

DISCUSSION This study has reviewed cross-cultural reward allocation effects where the allocator did not benefit from the allocation. There is a small and positive overall effect indicating that the cultural samples do differ in their allocation behavior. However, the effect sizes are very heterogeneous and moderator variables were identified as important. First, effect sizes differ depending on the way the results were presented. Studies using employees found somewhat different effect sizes, indicating that students and working adults differ in their allocation responses. More specifically, the combination of these two moderators resulted in homogeneous clusters of studies, suggesting that type of sample and data analytical techniques have a joint effect on effect sizes. Furthermore, the study design (rating versus allocation) also has an effect on effect sizes. It might be that rating of preferred allocation principles involves a different mechanism than actually allocating some (hypothetical) rewards. This effect needs further investigation (see below). It will be necessary to determine whether these factors work independently, interact with each other, or are due to confounds with other variables. The samples studied differed along various cultural dimensions simultaneously. Specifically, the samples differed in terms of a horizontal-vertical dimension reflecting Power Distance, Hierarchy, and Egalitarian Commitment and along a Harmony versus Mastery/ Masculinity dimension. Post hoc explanations of study outcomes in terms of any single cultural dimension without measuring and linking this dimension directly to the outcome of interest are therefore questionable. Second, hierarchical differentiation within societies is related to allocation behavior. More hierarchical cultures allocate rewards more differentially, on the basis of equity and performance inputs, whereas more egalitarian and less hierarchical cultures prefer equality over equity. The Gini index measuring income inequality showed a similar relationship with effect sizes. However, Schwartz’s (1994) Hierarchy dimension accounted for variance in effect sizes even beyond income inequality. This is consistent with some recent intracultural studies. Chen et al. (1997) found that Chinese employees who scored high on vertical collectivism were in favor of a reform of the egalitarian socialist payment system in the People’s Republic of China and preferred equitable over egalitarian allocations. A recent study by Chang and Quak (2001) indicated that traditional Chinese values are not opposed to differential allocation and high achievement orientation but rather that collectivists are more sensitive to the context of the interaction (e.g., the status of the allocator). Therefore, it seems that horizontal-vertical differentiation is particularly important in explaining allocation behavior. At a macro level, this might have some important implications. Writing about equity theory, Deutsch (1975) warned that “by allocating rewards and power disproportionately, it enables those who are in power to bias the system of allocation to perpetuate their disproportionate rewards and power even when they are no longer making relatively large contributions” (p. 145). Therefore, using equity as a dominant and preferred allocation rule in cultures with strong power differences and social inequalities is likely to justify, reinforce, and potentially exacerbate this difference in power and wealth.

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A preference for equality in more egalitarian cultures is likely to lead to a more equal distribution of power and wealth, which would result in a cycle in the opposite direction. Third, it seems that collectivism is not related to the allocation of rewards, at least in situations where the allocator does not benefit from the allocation. If at all, the relationship seems to be in the opposite direction with more collectivist cultures emphasizing equity over equality. This is an unexpected finding and needs further exploration. Altogether, these results have some important implications for research in this field. IMPLICATIONS FOR CROSS-CULTURAL RESEARCH

The results indicate that the horizontal-vertical cultural dimension is important and needs to be included in both theory and research. Some attempts in this direction have already been reported (Chen et al., 1997; Erez, 1997; Triandis & Bhawuk, 1997). Individual-level measures incorporating hierarchical dimensions are available (Harb & Smith, 2001; Schwartz, 1992; Singelis, Triandis, Bhawuk, & Gelfand, 1995; Triandis & Gelfand, 1998) and can be used to link justice behavior to cultural values directly. This avoids committing the ecological fallacy (Hofstede, 1980). However, values may be only weak predictors of actual justice behavior, and expectancies may be better able to explain cross-cultural differences (Bond, Leung, & Schwartz, 1992). Beliefs or norms (Leung & Tong, 2001; Leung et al., 2002) could also be useful in unpacking the effects of culture (Singelis, 2000). The relationship of allocation with Individualism and related dimensions such as Affective Autonomy, although not significant, was in the opposite direction from what would be expected. Several possible explanations might account for this pattern. First, collectivists are likely to differentiate between in-group and out-group. The results might therefore be due to the fact that the described individuals in some studies were perceived as out-group members. Leung (1997) argued that the in-group/out-group dimension is more important where the allocator is tied to the recipients and also receives rewards in the transaction, whereas group membership should at most only weakly affect allocations in the situation where the allocator does not benefit from the allocation. However, the manipulations used in many studies do not allow a separation of in-group/out-group effects. None of the studies included in the present meta-analysis included an explicit manipulation of the in-group/out-group status of recipients. Post hoc explanations in previous narrative reviews (e.g., Smith & Bond, 1998) are ambiguous and open to alternative explanations. Furthermore, although the in-group/ out-group dimension is frequently cited in cross-cultural research, no systematic attempts have been made to define in-groups/out-groups and to establish what these terms mean and who would belong to them. Research by Triandis, Bontempo, Villareal, Asai, and Lucca (1988) indicated that individuals from different cultures are likely to differ in their definition of what constitutes an in-group. Harb and Smith (2001) showed that in-groups can also be differentiated along a horizontal-vertical dimension. More research is needed to investigate these possibilities. Second, power distance and collectivism are highly correlated at the culture level (Hofstede, 1980) with more collectivist cultures being more hierarchically differentiated. A consistent relationship of effect sizes with hierarchical differentiation as measured by cultural values and by income inequality was found in this study. Consequently, the allocation of rewards in work settings is influenced by the degree of hierarchical stratification within societies. In this context, the negative relationship with collectivism could be explained by the more hierarchical nature of collectivist cultures. However, this need not imply that collectivism is negatively related to an equal allocation of rewards in all situations. Collectivism is

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likely to explain an equal distribution of rewards when allocators are recipients and also receive rewards (Hui et al., 1991). Different cultural dimensions may affect allocation behavior in different types of situations. Summarizing, the analysis shows that the emphasis of contemporary cross-cultural research on individualism-collectivism may need adjustment in this area of research. This field has long been criticized for its lack of theory (Leung, 1997). We do now have models highlighting contextual factors and goals (Leung, 1997) and the hierarchical-vertical dimension (Erez, 1997), and these represent major advances in the study of reward allocation. However, even these models have focused only on the effects of task performance, and frameworks are needed that include additional allocation principles such as need, social skills, and tenure. The increasing importance of the service industry in contemporary economies makes predictions about the importance of other skills (e.g., social competence) in different cultures necessary. Tenure has also been shown to be an important predictor of organizational behaviors (Insko et al., 1980, 1982). IMPLICATIONS FOR FURTHER STUDIES

The present analysis showed that results depend on the samples studied. Student samples yielded different results from samples of employees. Greater attention is required to sampling strategies and the external validity of results. A second problem is the measurement of the dependent variable. A rating procedure (“what principle would you prefer”) may involve different mechanisms (due to different degrees of personal involvement, different availability of context, cognitive complexity, etc.) than procedures in which respondents are asked to allocate rewards (points, money, etc.). For instance, participants might opt for the easiest option when answering questions that demand complex cognitive operations (Harris, 1980; Harris & Joyce, 1980; Hook & Cook, 1979). Collectivists are thought to be more context dependent than individualists (Smith & Bond, 1998), and study designs therefore need to take method biases into account (van de Vijver & Leung, 1997). Future research needs to investigate these possibilities. Finally, the results were reported in different formats, making inferences across studies difficult. It is important that researchers report means, standard deviations, and correlations among variables to provide readers with an opportunity to gain a better understanding of their results. LIMITATIONS

The present analysis is limited in several respects. First and most important, the small number of studies limits the generalizability of the conclusions. Second, the high correlations between the various study characteristics (cultural dimensions, study designs, sample populations, etc.) make it impossible to judge the unique effects of these variables. Studies with particularly large effect sizes were comparisons between the United States and the People’s Republic of China (Chen, 1995); Australia and the People’s Republic of China (Keats & Fu-Xi, 1994) and the United States and Sweden (Tornblom, Jonsson, & Foa, 1985). These effect sizes may be due to large cultural distance, to using employees instead of students (Chen, 1995; Keats & Fu-Xi, 1994), to employing rating procedures (Chen, 1995, Tornblum et al., 1985), or to a combination of these and other factors. The multicollinearity of the cultural difference scores also precluded regression analyses. The absence of an effect for individualism could also be due to the absence of in-group/ out-group manipulations. Although Leung (1997) argued that the in-group/out-group

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dimension should not be salient in economic exchanges with a third-party allocator, participants from more collectivist cultures may have perceived the described individuals as outgroup members. As discussed previously, it was impossible to determine whether this was so. Finally, the present analysis mainly used contrasts to estimate interaction effects. The assigned contrasts were calculated as interaction effects. However, this might have resulted in a more conservative estimate because the effect might be more subtle (James, 1993). Furthermore, the calculated contrasts do not take into account the cultural difference between the samples studied. A more powerful analysis would use the main effects of the performance manipulation within each cultural sample, and the obtained intracultural effect sizes could then be used in a cross-cultural meta-analysis (e.g., Bond & Smith, 1996). However, most of the studies did not provide sufficient information for calculating effect size estimates within each cultural group.

CONCLUSIONS This article reviewed studies examining cross-cultural differences in reward allocation where the allocator is not a recipient. Contrary to previous narrative reviews (Erez, 1994, 1997; Leung, 1997), effect sizes were best explained by hierarchical cultural dimensions and not by collectivism. Various possible moderators including study design and participants studied were identified. The analysis highlighted theoretical and empirical problems that need to be addressed in future research.

APPENDIX Studies Included in the Meta-Analysis, Effect Sizes Calculated, and Additional Information

Authors

Year

Total N

Aral & Sunar

1977

137

Berman & Murphy- 1996 Berman

328

Reference Country (RC)

Comparison Country (CC)

N (RC)

United States United States

Turkey

69

68

Y

190

138

Y

West Germany

N Student (CC) Sample

Berman, MurphyBerman, & Singh

1985

80

United States

India

44

36

Y

Bond, Leung, & Wan

1982

207

United States

Hong Kong

99

108

Y

Chen

1995

471

United States

China

199

272

N

Chen, Meindl, & Hui Giacobbe-Miller, Miller, & Victorov Giacobbe-Miller, Miller, & Victorov Hundley & Kim

1998

241

126

Y

201

Hong Kong Russia

115

1998

81

120

N

1998

205

Russia

80

125

Y

1997

262

United States United States United States United States

S. Korea

75

187

Y

Dependent Variables

Other Manipulations

Reward Allocation Effect Size zr

Approval of equity fairness Inputs (education, experience, –.25 talent, effort) Liking of allocator, fairness, Conflict equity-need; positive— semantic differential ratnegative allocation ings of allocator Allocation of bonus and Conflict merit-need, sex of target, .30 cutbacks sex of respondent, positivenegative allocation Grade assigned (superordi- Task input, maintenance input .18 nation rewards), intimacy rewards Differential/equalitarian –.69 Differential rules (performance, preference for material/ rank, seniority, job need), socioemotional rewards equalitarian rules (group equality, individual equality) Differential allocation Productivity, interdependence, –.02 fairness Bonus allocation Productivity, good relations, .23 need — Perceptions of fair payment Payment; working under congruent condition Fairness, importance Performance, seniority, education, .16 family size, work effort

Overall Effect Size zr –.25 –.03

.30

.18

–.69

–.02 .23 –.22 .16

263

(continued)

264

APPENDIX (continued) Reference Country (RC)

Comparison Country (CC)

Authors

Year

Total N

Kashima, Siegal, Tanaka, & Isaka (Study 1) Kashima, Siegal, Tanaka, & Isaka (Study 2) Keats & Fu-Xi

1988

103

Australia

Japan

48

45

Y

Fairness, alterability of rules

Rule, need (debt), method of change

1988

112

Australia

Japan

56

56

Y

Fairness, alterability of rules

Rule, need (debt), age, method of change

1994

60

Australia

China

30

30

N

Product, effort, ability

Kim, Park, & Suzuki 1990

257

Japan

S.Korea

117

140

Y

Kim, Park, & Suzuki 1990

249

Japan

132

117

Y

Kim, Park, & Suzuki 1990

257

United States United States United States

S. Korea

117

140

Y

Hong Kong

30

30

Y

United States

S. Korea

88

88

Y

Allocation of apples, fairness ratings Primary rewards, social rewards Primary rewards, social rewards Primary rewards, social rewards Grade assigned, discuss results with target, evaluation of target, anxiety Fairness, reward allocation, evaluation of allocator (social competence, social evaluation)

Leung & Bond

1984

60

Leung & Park

1986

176

N (RC)

N Student (CC) Sample

Dependent Variables

Other Manipulations

Task input, maintenance input Task input, maintenance input Task input, maintenance input Contribution to group work

Productivity, allocation context

Reward Allocation Effect Size zr —

Overall Effect Size zr .20



.08

–.49

–.49

.37

.37

.49

.49

.42

.42

.44

.44

.13

.18

Lin, Insko, & Rusbult Mahler, Greenberg, & Hayashi (Study 2) Marin Marin Murphy-Berman, Berman, Singh, Pachauri, & Kumar Rusbult, Insko, & Lin (Study 1) Rusbult, Insko, & Lin (Study 2) Tornblom, Jonsson, & Foa

1991

293

1981

415

1985

90

1981, 1982 1984

208 186

1995

108

1995

116

1985

91

United States United States

Taiwan

150

143

Y

Salary allocation

Japan

153

262

Y

Equity-parity preference

United States United States United States

Indonesia

44

46

Y

Colombia

104

104

Y

India

84

98

Y

Liking of allocator, fairness, reward allocation Perception of allocator, fairness, reward allocation Bonus allocation and cutbacks

United States United States United States

Taiwan

65

43

Y

Taiwan

57

59

Y

Sweden

50

41

Y

Employee competence, social skills, job mobility Productivity

.10

.10

.03

.03

Performance, friends vs. strangers

.07

.07

–.18

–.07

Performance

Conflict merit-need, permanence, target sex, respondent sex, positivenegative allocation Allocation of salary, proTask competence, social motion recommendation competence, seniority Salary allocation promotion Task competence, social recommendation competence, sex Allocation preference Allocation rule, resource class

.11

.11

.22

.22

.21

.19

.73

.73

265

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JOURNAL OF CROSS-CULTURAL PSYCHOLOGY

NOTES 1. These recently included allocation principles were less often included in reviews and are therefore not included in this study. 2. An additional analysis used an average of all effect sizes obtained in the studies (e.g., Rosenthal, 1994), including liking of the allocator, perceived fairness of allocations, alterability of the allocation norm, and reward allocation. Inasmuch as no correlations between the dependent variables were reported, it was impossible to calculate more correct estimates (e.g., Rosenthal & Rubin, 1986). However, the results were very similar (r = .98) and are therefore not discussed in further detail. The resulting effect sizes are shown in the appendix. 3. When different input manipulations were used (experience, effort, tenure, etc.), only the effects of task or performance inputs were used in the analysis. A few studies did not allow a separation of these effects (Aral & Sunar, 1977; Keats et al., 1994); therefore, these effect sizes include other differential inputs such as effort and experience. The effect sizes for these different input manipulations were similar to the ones reported here. 4. The most recent country means were kindly made available by Shalom Schwartz. If the samples consisted of students, the country mean for students was used. The country mean for teachers was used when the samples consisted of working employees. There were no Schwartz data for Colombia (S. H. Schwartz, personal communication, June 2001). There were means available for Turkish samples from Ankara and Istanbul. Because the United StatesTurkish comparison (Aral & Sunar, 1977) used students from Ankara, this mean was used.

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Ronald Fischer is a lecturer in social psychology at Victoria University of Wellington, New Zealand. He obtained his D.Phil from the University of Sussex, UK. He has a keen interest in culture and believes that culture is too complex to be understood from a chair in an office. His research interests are in culture and its relation to organizations and work behavior (especially justice, organizational culture, work attitudes, and behavior) as well as cross-cultural research methodology. Peter B. Smith is a professor of social psychology at the University of Sussex. Receiving his Ph.D from the University of Cambridge, he has held teaching posts at the University of Sussex since 1966. His current interests are in cross-cultural aspects of social and organizational psychology, focusing particularly on leadership, values, cross-cultural communication, and the relation between individual and culture-level analyses. From 1995 to 2001, he was editor of this journal and is currently president of the International Association for Cross-Cultural Psychology.

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REWARD ALLOCATION AND CULTURE A Meta-Analysis

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