ABSTRACT
Over the past several decades, equity theory (Adams, 1963, 1965)—which predicts that members of organizations will strive to be rewarded equitably, rather than under-or overrewarded-has established itself as a foundational theory in organizational behavior and management. While equity theory has been highly successful in many respects, it has also been criticized for various reasons. The purpose of this chapter is to suggest that one of these criticisms-equity theory’s unreliability in situations of overreward-could be met more effectively if organizational scholars reformulated equity theory from an evolutionary psychological perspective. Equity theory would gain increased predictive power from this reformulation, because it would become better able to address the tendency of members to seek overreward-a tendency that has been recognized for decades in the social sciences as the “free rider problem” (Olson, 1965). An improvement in equity theory’s ability to address the free rider problem would significantly enhance the theory’s usefulness because the free rider problem is not just a trivial detail that equity theory overlooks. On the contrary, overcoming this problem is central to the health and success of any organization (Olson, 1965; Albanese & Van Fleet, 1985; Ostrom, Walker, & Gardner, 1992), and the reasons for this problem’s centrality are thrown into relief by the evolutionary psychological perspective (Price, Cosmides, & Tooby, 2002; Tooby, Cosmides, & Price, 2006). An evolutionarily updated equity theory would help to explain both why free rider problems commonly occur at all organizational levels (including managerial levels, as will be emphasized at the conclusion of this chapter), and also how solving these problems can be a key to improving organizational productivity.
