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A taxonomy of reward preference: Examining country differences

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  • Chiang, Flora F.T.
  • Birtch, Thomas A.

Abstract

Reward practices that are effective in one country may be very different from those that are successful in others. This is largely due to reward preference, which is shaped by individual needs, values and expectations. By integrating both the theories of motivation and culture, this study examines employee reward preference in four countries: the United Kingdom, Canada, Finland and Hong Kong. A construct for examining the multi-dimensional nature of reward is used, the type-system-criterion (TSC) model, to identify where specific differences in reward preference lie. The findings lend support to and extend the existing body of research. Yet, in contrast to prior research, empirical analysis reveals that while preferences for certain types of rewards remain relatively divergent, differences in preferences for both reward systems and the criteria by which rewards are allocated are diminishing as the forces of convergence take hold. The findings are particularly relevant to managers engaged in the design and implementation of reward practices in a MNC environment and open reward research to a promising new direction.

Suggested Citation

  • Chiang, Flora F.T. & Birtch, Thomas A., 2005. "A taxonomy of reward preference: Examining country differences," Journal of International Management, Elsevier, vol. 11(3), pages 357-375, September.
  • Handle: RePEc:eee:intman:v:11:y:2005:i:3:p:357-375
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    References listed on IDEAS

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    1. Baker, George P & Jensen, Michael C & Murphy, Kevin J, 1988. " Compensation and Incentives: Practice vs. Theory," Journal of Finance, American Finance Association, vol. 43(3), pages 593-616, July.
    2. Hempel, Paul S., 1998. "Designing multinational benefits programs: The role of national culture," Journal of World Business, Elsevier, vol. 33(3), pages 277-294, October.
    3. Ashkanasy, Neal M. & Trevor-Roberts, Edwin & Earnshaw, Louise, 2002. "The Anglo Cluster: legacy of the British empire," Journal of World Business, Elsevier, vol. 37(1), pages 28-39, April.
    4. Randall S Schuler & Nikolai Rogovsky, 1998. "Understanding Compensation Practice Variations Across Firms: The Impact of National Culture," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 29(1), pages 159-177, March.
    5. Karen L Newman & Stanley D Nollen, 1996. "Culture and Congruence: The Fit Between Management Practices and national Culture," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 27(4), pages 753-779, December.
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    Cited by:

    1. Carolan McLarney & James Hansen, 2016. "Influences on Employee Reward Strategies in International Organizations," Proceedings of International Academic Conferences 3305200, International Institute of Social and Economic Sciences.
    2. Pouliakas, Konstantinos & Theodossiou, Ioannis, 2012. "Rewarding carrots and crippling sticks: Eliciting employee preferences for the optimal incentive design," Journal of Economic Psychology, Elsevier, vol. 33(6), pages 1247-1265.
    3. Pouliakas, Konstantinos & Theodossiou, Ioannis, 2009. "Rewarding Carrots & Crippling Sticks: Eliciting Employee Preferences for the Optimal Incentive Mix in Europe," MPRA Paper 14167, University Library of Munich, Germany.

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