MAKING JUSTICE SENSE OF LOCAL-EXPATRIATE COMPENSATION DISPARITY: MITIGATION BY LOCAL REFERENTS, IDEOLOGICAL EXPLANATIONS, AND INTERPERSONAL SENSITIVITY IN CHINA-FOREIGN JOINT VENTURES.

We examined how local employees of international joint ventures (IJVs) perceived disparity between their compensation and foreign expatriates\u27 compensation from equity theory and social justice perspectives. Chinese locals perceived less fairness when comparing their compensation with expatriates\u27 than when comparing it with other locals\u27. However, fairness vis-a-vis expatriates increased if the locals were compensated higher than their peers in other IJVs or endorsed ideological explanations for expatriates\u27 advantage. Furthermore, expatriates\u27 interpersonal sensitivity toward locals reduced the effect of disparity on perceived fairness. Finally, perceived compensation fairness was related positively to compensation satisfaction but negatively to intentions to quit