Psychological Ownership and the Organizational Context

Psychological Ownership and the Organizational Context

Theory, Research Evidence, and Application

New Horizons in Management series

Jon L. Pierce and Iiro Jussila

Psychological ownership as a phenomenon and construct attracts an increasing number of scholars in a variety of fields. This volume presents a comprehensive and up-to-date review of the psychological ownership literature with particular attention paid to the theory, research evidence, and comments on managerial applications.

Chapter 8: Formal and Psychological Ownership:

Jon L. Pierce and Iiro Jussila

Subjects: business and management, organisational behaviour


the employee-owned organization* In the last chapter we focused our attention on the antecedents, that is, those organizational forces that are hypothesized to causally contribute to the emergence of psychological ownership. In this chapter, we continue our focus on the indirect determinants of psychological ownership, with an exclusive focus on those arrangements that fall under the rubric ‘employee ownership.’ Employee ownership as employed here is concerned with those formal (legal) organizational arrangements whereby the organization’s employees are partial or full owners of their employing organization. It is within this context that the study of psychological ownership, as discussed throughout this book, initially became part of the management and organizational sciences (cf. Etzioni, 1991; Pendleton, Wilson, and Wright, 1998; Pierce, Rubenfeld, and Morgan, 1991; Wilpert, 1991; Winther, 19991). Before turning to our discussion of employee ownership and the role played by psychological ownership, we note that this chapter is entirely conceptual. It reflects our theorizing on the relationship between the two constructs and their effects. In addition, it presents an abbreviated view of the literature focused on ownership-performance relationship. This chapter concludes with an ‘individual-level process model for employeeownership effects.’ To our knowledge this model has not been empirically tested in its entirety. There is, however, empirical evidence that speaks to several of the relationships expressed in the model and these findings are presented in the next chapter. PSYCHOLOGICAL OWNERSHIP AND THE EMPLOYEE-OWNED ORGANIZATIONAL ARRANGEMENT During the latter part of the twentieth century, a strong interest in employee ownership, as an...

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