Psychological Contracts across Cultures

What is it about?

This article explores the relationship between national culture and individuals’ psychological contracts. Predicted relationships were drawn from prior theory that identified cognitive and motivational mechanisms through which culture manifests its influence. The dominant forms of psychological contracts were evaluated against predictions based on the national-level cultural values of vertical and horizontal individualism and collectivism in four countries. Results of interviews with 57 participants indicated that French interviewees (vertical individualist) described their psychological contracts as primarily exploitive, Canadians (horizontal individualist) as primarily instrumental, Chinese (vertical collectivist) as primarily custodial and Norwegians (horizontal collectivist) as primarily communitarian.

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Why is it important?

Managers should find it useful to understand systematic cultural variation in the psychological contract as a basis for managing more effectively in an increasingly global business environment (Cyr & Schneider 1996). By being better able to predict employee expectations of exchange relationships, employers will be better equipped to effectively communicate organizational messages, and to avoid perceived contract breaches. The organizational outcomes of meeting culturally based expectations of the exchange relationship are likely to be higher employee satisfaction, more employee loyalty, and less turnover (Robinson & Morrison 2000; Robinson & Rousseau 1994; Turnley & Feldman 1999).

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