Cited by 255Job Satisfaction and Organizational BehaviorEmployee Performance and ManagementEmployee Performance and Motivation

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The effects of pay level on organization‐based self‐esteem and performance: A field study

Gardner, Donald G., Van Dyne, Linn, Pierce, Jon L.·2004·Journal of Occupational and Organizational Psychology

DOI 10.1348/0963179041752646

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Abstract

Most compensation managers implicitly assume (or perhaps hope) that high pay levels will maintain and enhance future performance. To date, this assumption has been largely untested. Given the importance of pay level and the large expense that pay represents to most organizations, understanding how and why pay level influences the behaviour of employees in organizations is an important question. The purpose of this study is to examine the motivational effects of pay level on employee performance. To examine these issues, we collected field study data from a variety of sources, at three different times, and assessed the effects of employee pay level on subsequent self‐esteem and performance. Specifically, we hypothesized that the effects of pay level on performance would be mediated by pay level effects on organization‐based self‐esteem. We base this hypothesis on the premise that level of pay within an organization communicates a sense of how much the organization values an employee and thus affects employee organization‐based self‐esteem which, in turn, enhances job performance. After controlling for organization tenure, and previous pay change, results supported a mediated model that suggests that pay level affects employee self‐esteem, which in turn, affects employee performance.

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Authors: Gardner, D. G., Van Dyne, L., & Pierce, J. L.
Affiliations: University of Colorado Colorado Springs (US)
University of Minnesota, Duluth (US)
Corresponding author: Gardner, Donald G.
ORCID: Gardner, Donald G.
Pierce, Jon L.
Venue: Journal of Occupational and Organizational Psychology
Publisher: Wiley
Published: 2004-09
Volume: 77
Issue: 3
Pages: 307-322
ISSN: 0963-1798 (ISSN-L)
2044-8325
DOI: 10.1348/0963179041752646
OpenAlex: W1992998185
Cited by: 255
References: 63
Citations by year: 2026: 5 · 2025: 7 · 2024: 13 · 2023: 18 · 2022: 21 · 2021: 16 · 2020: 12 · 2019: 17 · 2018: 16 · 2017: 20 · 2016: 10 · 2015: 9 · 2014: 22 · 2013: 14 · 2012: 18
FWCI: 6.49
Type: journal article
Language: en
Open access: closed
Licence: onlinelibrary.wiley.com/termsAndConditions#vor (vor, 2297 d)
Locations: Journal of Occupational and Organizational Psychology (publishedVersion)
Topics: Social Sciences › Business, Management and Accounting › Organizational Behavior and Human Resource Management › Job Satisfaction and Organizational Behavior
Social Sciences › Business, Management and Accounting › Organizational Behavior and Human Resource Management › Employee Performance and Management
Social Sciences › Business, Management and Accounting › Organizational Behavior and Human Resource Management › Employee Performance and Motivation
Keywords: wage levels, organization-based self-esteem, employee performance, compensation, mediation, employee recognition

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The effects of pay level on organization‐based self‐esteem and performance: A field study

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