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Job satisfaction and relative income in economic transition: Status or signal?: The case of urban China

  • GAO, Wenshu
  • SMYTH, Russell

We use two datasets for urban China to examine whether an increase in reference group income lowers or increases job satisfaction. The former is consistent with a status effect -- an increase in the income of others lowers my satisfaction because I feel jealous. The latter is consistent with a signal effect -- an increase in the income of others might make me jealous, but it also provides an information signal about my future prospects. When we use a single item indicator of job satisfaction we find no support for a status or signal effect; however, when we use a psychometrically valid instrument to measure job satisfaction, we find some support for the existence of a status effect. We consider the components of job satisfaction through which the status effect operates. We find that the status effect operates through satisfaction with co-workers, operating procedures, pay and supervision.

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Article provided by Elsevier in its journal China Economic Review.

Volume (Year): 21 (2010)
Issue (Month): 3 (September)
Pages: 442-455

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Handle: RePEc:eee:chieco:v:21:y:2010:i:3:p:442-455
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