equity theory
a theory of justice regarding what individuals are likely to view as a fair return from activities involving themselves and a number of other people. The theory posits that people compare the ratio of the outcome of the activity—that is, the benefits they receive from it (e.g., pay, fringe benefits, intrinsic gratifications, recognition)—to their inputs (e.g., effort, seniority, skills, social status) with the outcome-to-input ratios of those engaged in a comparable activity. Outcomes are equitable only when people receive benefits that are proportional to their inputs. See external inequity; internal inequity; overpayment inequity; underpayment inequity.