When is it “a pleasure to do business with you?” The effects of relative status, outcome favorability, and procedural fairness

Abstract

Previous research on encounters between parties of differing status tend to examine the influence of the higher status party (e.g., managers) on the lower status party (e.g., their direct reports), rather than the other way around. We suggest that it is important to examine the reactions of both higher and lower status parties (e.g., their desire for future interaction) to their encounters with one another. Furthermore, both parties’ relative status is hypothesized to influence their desire for future interaction with one another, in conjunction with the outcome favorability associated with the encounter and the other’s procedural fairness. This hypothesis was tested in a pilot study as well as in two full-scale studies. All three studies showed that outcome favorability and procedural fairness interacted to influence participants’ desire for future interaction with the other party. However, the nature of the interactive relationship differed as a function of participants’ relative status. For lower status people, high procedural fairness reduced the positive relationship between outcome favorability and their desire for future interaction with the other party, relative to when procedural fairness was low. For higher status people, high procedural fairness heightened the positive relationship between outcome favorability and desire for future interaction, relative to when procedural fairness was low. Implications for the literatures on relationships in work organizations, organizational justice, and status are discussed.