Global Entrepreneurship, Income, and Work Norms: A Seven Country Study

Abstract

ABSTRACT The subjects used for this study consist of 6,307 individuals from 7 countries examining the influence that work norms have on actual income received across 4 occupational groups--Entrepreneurs, Engineers, Educators, and White Collar Employees--and the general population. Differential prediction is found across the occupational groups with entrepreneurs found to be most similar to teachers--but still having a unique structure of the relationship between work norms and income. Directions for future research are suggested. INTRODUCTION Compensation has long been a topic of interest to employees and employers alike. In fact, the use of compensation as a motivator has been traced to antiquity (Peach & Wren, 1992). The concept of an employment relationship implies that employees work in exchange for some reward, and this reward is often monetary compensation (Brockner, 2002; Janssen, 2001). Thus, pay has emerged as a popular variable for use in organizational research (for reviews, see Heneman, 1985; Heneman & Schwab, 1979; Miceli & Lane, 1991; Rynes & Gerhart, 2000). Pay exhibits significant relationships with organizationally important outcomes such as absenteeism (Weiner, 1980), turnover intentions (Hom & Kinicki, 2001; Steel, Griffith, & Horn, 2002), organizational citizenship behaviors (Lambert, 2000) and job performance (Werner & Mero, 1999). As noted by Rice, Phillips, and McFarlin (1990), one of the most intriguing findings with respect to pay is the modest strength of the relationship between how much an individual is actually paid and that individual's pay satisfaction. Although this relationship typically has been positive and statistically significant, it has generally explained well under 25% of the variance in pay satisfaction. These findings have led others to examine the prediction of pay based upon multiple discrepancies or multiple monetary standards of comparison for the individual employee (Law & Wong, 1998) and demographic and psychological variables (Berkowitz, Fraser, Treasure, & Cochran, 1987). Scholars have noted that comparatively little research advances models of pay and their predictors (Heneman, 1985; Miceli & Lane, 1991; Opsahl & Dunnette, 1966; Rynes & Gerhart, 2000; Williams & Brower, 1996). This could be due to the assertions of some researchers that it is clearly too early to offer a precise theoretical model of the determinants of income satisfaction (Berkowitz et al., 1987, p. 546), yet such model development is still needed (Rynes & Gerhart, 2000). This is especially important in the area of individual entrepreneurship as little work has been done examining the compensation practices of entrepreneurial organizations--or for entrepreneurs themselves (Buckley, Carrraher, Ferris, & Carraher, 2001; Parnell, Carraher, & Odom, 2000)--especially across cultures (Box, Beisel, & Watts, 1995; Parnell, Crandall, & Menefee, 1995). How do people experience work, and how are these experiences linked to the economic outcomes of work? The major intellectual traditions within the study of work have been summarized by Dubin (1976). An examination of within-culture, and cross-cultural studies of why individual's work results in identifying six different central variables--or work norms--which may explain why people work. The first of these is the concept of Work Centrality (Lawler & Hall 1970; MOW international work team 1987; Zedeck, 1992). Work centrality is the general belief about the importance of working within one's life. It can be thought of as the degree to which work is seen as the most important variable for developing one's self-concept or self-image (Super, 1953; 1957; Super et al., 1967). The second work norm is the view of work as an Obligation to one's employer, society, and/or family--with the obverse of this being work as an entitlement (Erickson & Vallas, 1990; Etzioni, 1961; Kohlberg, 1963; Piaget, 1965; Zedeck, 1992). …