Abstract:

Turnover is an important issue in the organizational management research, but few studies study it in the framework of risky choice. In this paper, we view turnover as a risky choice and explore the relationship between subjective wage gap and turnover intention on the basis of Tri-reference Point (TRP) theory. Our theoretical analysis and pilot study found that: (1) the perceived salary gap between the salary status quo (SQ) and the minimum salary requirement (MR) of an employee predicts turnover intention negatively, and the salary gap between the desired salary goal (G) and the status quo salary predicts turnover intention positively. (2) Based on the MR > G > SQ psychological impact priority order of the TRP theory, we derived a nonlinear function relationship with double inflection points between the salary gaps (e.g., distance between SQ salary and G salary, or between MR and SQ salaries) and turnover intention. (3) As a horizontal comparison reference, the peer income distributions of similar companies play an anchoring role in the relationship between salary gaps and turnover intention.(4) As a vertical comparison reference, the salary distribution within organization has a moderating effect on the settings of salary reference points of MR, and G and thus turnover intention. Regarding turnover decision as a risky choice, not only has significance for the development of turnover theory and decision theory, but also provides guidance and insights for the human resource management practice.

Key words: turnover intention, perceived salary gap, tri-reference point theory, risky choice