The Influence of the Tri-reference Points on Fairness and Satisfaction Perception

We examined the influence of three reference points (minimum requirements [MR], the status quo [SQ], and goal [G]) proposed by the tri-reference point (TRP) theory on fairness and satisfaction perceptions of pay in three laboratory experiments. To test the effects, we manipulated these three reference points both implicitly (Experiment 1) and explicitly (Experiments 2 and 3). We also provided the information of the salary offered to a peer person that was lower than, equal to, or higher than the salary offer to the participant. As hypothesized, the results demonstrated the important role of these reference points in judging the fairness of and satisfaction with pay when they were explicitly set (an interaction between reference points and social comparison in Experiments 2 and 3, but not in Experiment 1). Participants altered their judgments when the salary was in different regions. When the salary was below MR, participants perceived very low fairness and satisfaction, even when the offer was equal to/exceeded others. When the salary was above G, participants perceived much higher fairness and satisfaction, even with disadvantageous inequality. Participants were more impacted when they were explicitly instructed of the reference points (Experiments 2 and 3) than when they were not (Experiment 1). Moreover, MR appeared to be the most important, followed by G. A Salary below MR was judged as very unacceptable, with very low fairness and satisfaction ratings.