The effects of psychological contract violation on Chinese executives

Abstract

We investigate the influence that a violation of psychological contracts can have on organizational commitment both in main and moderating effects. Although there have been many studies relating to the negative effects of psychological contracts on organizational outcomes, our study is the first to examine these potentially negative effects on executives. As well, few studies have used the Chinese landscape to determine if Chinese employees develop psychological contracts and if so, to delve into whether these violations have similar impacts on Chinese employees as on their Western counterparts. Our sample consists of 200 Chinese executives from Mainland China. The sample includes CEOs, executive vice presidents, and general managers, all of which are powerful decision makers. We found that a violation of psychological contracts for Chinese executives has a strong negative relationship with organizational commitment. Our results also show the interactional effects of both job and person related variables and psychological contract violations on organizational commitment. More specifically, job involvement, job satisfaction, and hope decrease the negative effects of psychological contract violations, while job demand and locus of control heighten the negative effects of psychological contract violations. Thus, psychological contract research is applicable not only for the Western employee but is also relevant within the Asian context.