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Psychological Contract and Turnover Intention: The Mediating Role of Organizational Commitment

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DOI: 10.4236/jhrss.2017.51003    931 Downloads   1,471 Views  

ABSTRACT

In this paper, the theory of resource conservation is introduced to explore the influence of psychological contract on turnover intention of employees, and the mediating mechanism of organizational commitment is tested. Through the questionnaire survey of employees in high-tech enterprises in Xian City, we use the structural equation model for empirical research; the results shows that: 1) the transactional and the relational psychological contract has a significant impact on turnover intention; 2) organizational commitment plays a fully mediating role in the relationship between transactional psychological contract and turnover intention, and plays a partial mediating role in the relationship between relational psychological contract and turnover intention.

1. Introduction

The rise of knowledge economy makes talents become the most important source of competitive advantage for organizations (Halawi, Aronson & 2005 [1] , McCarthy; Snellman & Powell, 2004 [2] ). However, the loss of the core talent has become the sore point of many enterprises. High turnover rate will not only increase the cost of recruitment and selection, but also reduce the organizational morale and weaken the intellectual capital; this is not conducive to sustained and healthy development of enterprises. Therefore, the exploration of the influencing factors of employee turnover intention has aroused wide attention in academic circles.

The existing research on the influencing factors of employee turnover intention can be divided into three aspects: the first one is the personal characteristics of employees, including age, seniority, gender, marital status, education level, income; the second one is working and organizational characteristics: including organizational culture, organizational support, organizational justice, organizational integration and working conditions, work load, and work autonomy; the third one is the external factors of the organization: including employment opportunities and labor market conditions. With the development of social exchange theory and resource conservation theory, the study of employee turnover intention based on the perspective of psychological contract has gradually become the characteristics of the related research [3] . Some scholars believe that the psychological contract has a direct impact on employee turnover intention [4] , but some scholars hold different views that psychological contract has an indirect impact on employee turnover intention, which means that psychological contract needs the intermediary variables’ auxiliary effect to exert its influence. Based on the conclusions of these studies, we think it is necessary to further explore the influence mechanism of psychological contract on employee turnover intention.

Based on the resource conservation theory, this paper puts forward the theoretical model that psychological contract will not only have a direct impact on turnover intention, but also have an indirect impact on turnover intention through organizational commitment. Based on the questionnaire survey data of the employees of high-tech enterprises in Xi’an City, we empirically examine the theoretical model. The existing literatures on the relationship between psychological contract and turnover intention are based on the social exchange theory. This paper introduces the theory of resource conservation, and studies the influence mechanism of psychological contract on staff turnover intention from a different perspective, so as to make our contribution to related literature on the psychological contract and the staff turnover intention.

2. Theoretical Basis and Research Hypothesis

2.1. Resource Conservation Theory

Resource conservation theory believes that personal resources (such as time, physical and emotional state and attention, etc.) are limited; the individual has a desire to acquire, preserve and maintain their own limited resources. When an individual in an environment where his personal resources are perceived to suffer, be threatened or the return of these resources doesn’t meet the expectation, the individual will have a sense of insecurity and burnout. Therefore, individuals will reduce their stress by maintaining and making up their resources (Hobfoll, 1989) [5] .

Hobfoll (2002) pointed out that employees’ basic resources in the work include individual resources and relationship resources [6] . Individual resources include optimism, Organization-based self-esteem, self-efficacy and other factors, these factors can motivate employees to achieve their goals when an employee faces with adversity and challenges, to of positive beliefs. Individual resources can keep employees’ positive working emotions, improve their intrinsic motivation and job satisfaction, and reduce their turnover intention. Relationship resources are the factors that help to meet the requirements of employee’s work, including work autonomy, organization support, and so on, which can help to reduce the employee’s physiological and psychological pressure, and promote the employee’s work engagement. Work autonomy give employees the authority to decide their own working methods and progress, it is an important psychological demands of the knowledge workers, can stimulate the employee’s intrinsic motivation and vitality. High job autonomy not only meet employees’ psychological demands but also enhance their organizational identification; organizational support includes supervisor support, peer support and organizational culture support, high organizational support can satisfy employee’s social emotional needs, promote the realization of work objectives, while strengthening the employees’ sense of trust and belonging for their organization, improve staff’s understanding of the organization’s and the significance of the work [7] .

Relationship resources and individual resources influence and boost each other in the work. Relationship resources such as work autonomy, organizational support etc., will give employees a positive psychological experience, and affect the employee’s hope optimism and self-esteem and other individual resources through the conduction of positive emotions, [8] . Employee’s individual resources can also influence their own perception of the relationship resource. Employee’s individual resources such as optimism, self-esteem and self-efficacy, and so on, can make themselves maintain a positive attitude towards relationship resources, and actively make use of the relationship resources to meet the requirements of the work. When the individual resources are low, relationship resources tend to be seen negatively by the employees.

Based on the theory of resource conservation, the psychological contract, which is an relationship resources perceived by the employee, will affect the employees’ sense of identity, belonging and the active degree of participation in organizational activities (organizational commitment) and then weaken employee’s individual resources through the conduction of negative emotion, so it has an important influence on the employee’s turnover intention.

2.2. Research Hypothesis

2.2.1. Psychological Contract and Turnover Intention

Rousseau divided psychological contract into two parts, namely transactional psychological contract and relational psychological contract, the transactional psychological contract is the contract relationship based on economic exchange, reflects that employee exchanges working overtime, extra work duties for high returns, performance-based awards, training and occupation development provided by the organization; relational psychological contract is contract relationship based on social emotion exchange, reflects that employee exchanges working long-term, loyal and willing to accept internal work adjustment for long- term job security supplied by the organization [9] .

According to the resources conservation theory, a breach of transactional psychological contract and relational psychological contract may lead to the loss of employee’s economic resources and emotional resources, in order to alleviate the pressure, the employee must obtain some resources through other channels to make up for the loss of economic resources and emotional resources. If an employee suffers great loss of economic resources and emotional resource seven the depletion of these two resources because of the breach of psychological contract, the staff will have the intention and behavior of withdrawal. The research of Tumley and Feldman (2000) found that there was a positive correlation between the breach of psychological contract and the employee's turnover intention and dereliction of duty [9] . Wei Feng (2004) in an research on the breach of organization―manager psychological contract, pointed out that the breach of psychological contract will directly affects employee’s EVLN (Exit, Voice, Loyalty, Neglect [10] ). This shows that there is a certain degree of negative relationship between psychological contract and turnover intention. So we make the following research hypothesis:

H1a: Transactional psychological contract has a certain negative impact on turnover intention.

H1b: Relational psychological contract has a certain negative impact on turnover intention.

2.2.2. Psychological Contract and Organizational Commitment

Organizational commitment is the employees’ loyalty and the sense of identification to their organization, and the initiative in the organization activities. Since the Canadian scholar Allen and Meryer (1990) [11] proposed a three-di- mension division of organizational commitment (affective commitment, continuous commitment and normative commitment), scholars in the study of organizational commitment mainly focus on these three aspects. Affective commitment reflects the organization members’ degree of involving in organizing and participating in the social communication in organization. It is a kind of emotion and positive psychological tendency of the individual to the organization. Continuous commitment reflects the commitment that the employees in order not to lose the existing position and benefits for which they exchange years of investment. This commitment is built on the basis of economic principles, possessing a heavy hue of trading. Normative commitment reflects the commitment that the employees, who adhere to a general code of practice, will produce a sense of responsibility and responsibility, thus they feel that they must work for the organization.

According to the resources conservation theory, when the employee’s psychological contract has not been fulfilled, namely the use of employee’s economic resources and emotional resources have not been fairly compensated, then the employees’ loss of their own resources will dent their loyalty and sense of identity to the organization, and weaken the enthusiasm to participate in the activities of the organization. If there is a breach of employees’ transactional psychological contract, which will cause the loss of their economic resources, and force employee relieve stress by way of obtaining new economic resources, so coming into a new organization to obtain new economic resources has become a rational choice of employees, thereby reducing their continued commitment to the organization. The fulfilling of the relational psychological contract, namely the emotional resources has been fairly compensated, can reduce employees’ physiological and psychological pressure, stimulate their working psychology and job involvement, and more deeply participate in the organization level social interaction, produce more emotional dependence on organization. At the same time it will enhance employees’ sense of responsibility to the organization, thus strengthen their affective commitment and normative commitment to the organization. Bal, De Lange, Jansen & Van Der Velde (2008) [12] made an element analysis, and the results showed that there was a moderate negative correlation (0.39, 0.38) between the breach of psychological contract and affective commitment. Shore et al. [13] (2006) proposed and confirmed that there was a strong positive correlation between employees’ relational psychological contract and affective commitment, and there was a strong correlation between transactional psychological contract and continued commitment. There are few scholars researching the correlation between the normative commitment and psychological contract. Therefore, we propose the following hypothesis:

H2a: Transactional psychological contract has a positive impact on organizational commitment.

H2b: Relational psychological contract has a positive impact on organizational commitment.

2.2.3. Organizational Commitment and Turnover Intention

The turnover intention, which is a direct antecedent variable of turnover behavior, reflects the tendency, willing and plan of departure. A large number of empirical studies show there is a significant positive correlation between turnover intention and actual turnover behavior. Therefore, turnover intention is often used as an alternative variable to measure the turnover behavior.

Study on the relationship between organizational commitment and turnover intention began in 1970s, Atchison and Lefferts’s (1972) [14] study showed that employees with high organizational commitment were willing to pay more efforts to accomplish organizational goals and tended to stay in the organization to achieve higher goals. Matmeu (1993) [15] and Tett & Meyer (1993) [16] summed up the previous research, and came to the conclusion respectively that the correlation coefficient between organizational commitment and turnover intention was −0.46 and −0.54. They believed that the higher the employees’ organizational commitment, the more time, energy and feelings they invested in organizations, the smaller the possibility of leaving the organization. Domestic scholar Pan Sheng (2010) [17] researched the difference of the turnover intention of knowledge workers in manufacturing enterprises in different commitment profiles. The results showed that the employees with no commitment profile had the highest turnover rate. So we make the following assumptions:

H3: Organizational commitment has a certain negative impact on turnover intention.

2.2.4. The Mediating Role of Organizational Commitment

Based on the existing literature review we found that the effect of psychological contract on organizational commitment is very important on the one hand, on the other hand, organizational commitment is also an important factor to predict the employee retention. More important is that Émilie & Christian (2013) and other scholars have shown that affective commitment was a mediator in the relationship between employees’ turnover intention and psychological contract. So the psychological contract can directly affect employee retention, and indirectly impact on retention through some mediating variables (such as organizational commitment). When the psychological contract cannot affect employees' retention directly, it also needs some mediating factors such as organizational commitment to further catalyze employees’ retention. Therefore, we make the following assumptions:

H4: Organizational commitment plays a mediating role between psychological contract and turnover intention.

3. Study Design

3.1. Questionnaire Design, Release and Recovery

This survey involves a total of 3 high-tech enterprises in Xi’an City, in order to make the data more representative, we selected a state-owned enterprise, a private enterprise and a foreign joint venture respectively. The survey began in May 2016, ended in August 2016, a total of 300 questionnaires were issued to the enterprise, the actual recovery copies were 273, and we deleted the invalid questionnaire, a total of 240 questionnaires were valid. There were 75 state-owned enterprise employees, accounting for 31.25%, 101 private enterprise employees, accounting for 42.08%, 64 joint venture employees, accounting for 26.67%.

The demographic information of the survey data is as follows: 126 males, accounting for 52.5%; 114 females, accounting for 47.5%. There are 187 employees under the age of 30, accounting for 77.92%; there are 41 employees between the ages of 30 - 50, accounting for 17.08%; there are 12 employees above the age of 50, accounting for 5%; survey objects are relatively young. From the perspective of educational background, the number of undergraduate and junior college student is 201, accounting for 83.75%; master and above is 30, accounting for 12.5%; the default is 9, accounting for 3.75%,

Almost all of the subjects received higher education. From the perspective of seniority, there are 159 employees who have less than 1 year working experience, accounting for 66.25%; there are 36 employees who have 1 - 5 years working experience, accounting for 15%; there are 10 employees who have more than 10 years working experience, accounting for 4.17%; the overall employee working life is relatively short, so it may lead to problem of departure.

3.2. Questionnaire Variable Design

The measurement scale involves mainly employee psychological contract scale, organizational commitment scale and turnover intention scale.

The measurement psychological contract, we use some items in Russeau (2004)’s “psychological contract questionnaire”. In this study, the psychological contract scale consists of 12 items, including two parts: one part is the measurement of transactional psychological contract of employees, a total of 6 items, such as “My wage is out of proportion to my cost”, the other part is the measurement of relational psychological contract of employees, a total of 6 items, such as “In the work, I can get leader’s trust and respect”.

The measurement of organizational commitment, we use some the items in Allen & Mayer (1993)’s “organizational commitment scale”, in this study, there are 15 items measuring the organizational commitment. Among them there are 5 items measuring the affective commitment, such as “I have a strong sense of belonging in the organization; 5 items measuring the continued commitment, for example”, “if I hadn’t invested so many effort into the organization, I will consider other work”; 5 items measuring the normative commitment, for example “I’m not going to leave the organization, because I am responsible for the people in the organization”.

The measurement of turnover intention, according to the need, we set up 4 items in the turnover intention scale, such as: “I will look for other job opportunities”.

All scales involved in this paper are measured by the Likertscale, and the answers are from 1 to 5. “1” is completely inconsistent, “5” is very consistent. In order to ensure the validity of the data, we reverse the expression of some questions in this scale to screen the invalid questionnaire, and these questions will be scored reversely. At the same time, in order to ensure the validity of the measurement results, some items in the questionnaire are out-of-sequence processed.

3.3. Statistical Analysis

In this paper, based on the data collected in the study, the reliability and validity test is used to analyze the sample data to ensure the reliability and validity of the studying data, then we put forward the theoretical model based on the theory of resource conservation, and use Amos to analyze the data of questionnaire, finally we construct the structural equation model to test the research hypothesis and come to some conclusion. We use this way to interpret the mechanism of the effect of psychological contract on staff turnover intention from a different perspective.

4. Empirical Analysis and Results

4.1. Reliability and Validity Test of the Sample Data

The Cronbach’s α coefficient of total psychological contract scale is 0.824, the transactional psychological contract is 0.759, the relational psychological contract is 0.756. The α coefficient of total organizational commitment scale is 0.851, affective commitment is 0.788, continued commitment is 0.762, normative commitment is 0.7. The α coefficient of retention scale is 0.714, all these coefficients are more than 0.7, which is the minimum acceptable level, it shows all the scales in this study has enough reliability.

We test the validity of the sample data by way of confirmatory factor analysis, we will delete all the items whose factor loading is less than 0.5, the transactional psychological contract, the relational psychological contract, the affective commitment, the continuous commitment all remove an item respectively, normative commitment delete two items. The fit indexes of each variable basically reach or close to standard. The fit indexes of each variable are shown in Table 1. Confirmatory factor analysis shows that the related variables scale of this study has higher validity.

4.2. Research Hypothesis Testing

Table 2 shows that there are significant negative correlations between the psychological contract, the organizational commitment and the employee turnover intention, a significant positive correlation is found between psychological contract and organizational commitment. This provides a basis for the further analysis of psychological contract, organizational commitment and employee turnover intention.

In this study, structural equation modeling is used to test the hypotheses. First, the direct relationship between the two dimensions of psychological contract (transactional psychological contract and relational psychological contract) and turnover intention is tested, and the structural equation model 1 (see Figure 1) is established. According to the analysis of Amos 7.0 statistical software, the

Table 1. Confirmatory factor analysis fit index of each variables.

Table 2. Correlation analysis results of study variables.

Note: *means p < 0.05; **means p < 0.01.

Figure 1. The model of the relationship between psychological contract and turn- over intention.

results of all fit indexes in model 1 are as follow: χ2/df = 2. 889, NNFI = 0.928, IFI = 0. 961, CFI = 0.959, RMSEA = 0.056, all reach or are close to the standard value of all indexes’ fitted values in structural equation model l, it shows that this model’s fitting degree can be acceptable, and the standard regression coefficients of the dependent variable turnover intention to the independent variables transactional psychological contract and relational psychological contract are −0.223 (p < 0.01) and −0. 488 (p < 0.01), and both are significant at the 0.01 level, which indicates that the transactional psychological contract and relational psychological contract both have significant negative influence on employee turnover intention, thus we prove the hypothesizes H1a, H1bin H1.

According to the researches of Baron and other scholars we concludes that the mediating effect shall meet the following conditions: first, the independent and mediating variables have significant relation to the dependent variable; second, there is significant relationship between the independent variables and the mediating variables; third, it is partial mediating variable when the mediating variable reduces the correlation between the independent variables and the dependent variable; similarly, it is full mediating variable when the mediating variable makes the correlation between the independent variables and the dependent variable insignificant. On the basis of above mediating effect test conditions, when we test the mediating effect of organizational commitment, not only the direct regression relationships of turnover intention to transactional psychological contract and relational psychological contract (model 1) are tested, but also the direct regression relationship of organizational commitment to transactional psychological contract and relational psychological contract (model 2) are tested, the direct regression relationship of turnover intention to organizational commitment (model 3), and the direct regression relationship of turnover intention to the two dimensions of psychological contract and organizational commitment (model 4).

In Figure 2, the structural equation model is mainly used to test the direct regression relationship of organizational commitment to transactional psychological contract, according to the analysis results of Amos statistical software, this model’s fit indexes are as follow: χ2/df = 2.575, NNFI = 0.922, IFI = 0.956, CFI = 0.934, RMSEA = 0.075, all reach or are close to the standard value of all indexes’ fitted values in structural equation model 2, it shows that this model’s fitting degree is acceptable, and the standard regression coefficients of the mediating variable organizational commitment to the independent variables transactional psychological contract and relational psychological contract are 0.268 (p < 0.01) and 0.605 (p < 0.01) respectively, which shows the transactional psychological contract and relational psychological the contract both have significant impact on organizational commitment.

In Figure 3, the structural equation model is mainly used to test the direct regression relationship of turnover intention to organizational commitment, according to the analysis results of Amos statistical software, this model’s fit indexes are as follow: χ2/df = 2.232, NNFI = 0.957, IFI = 0.921, CFI = 0.902, RMSEA = 0.057, all reach or are close to the standard value of all indexes’ fitted values in structural equation model 3, it shows that this model’s fitting degree is acceptable, and the standard regression coefficient of the turnover intention to the mediating variable organizational commitment is 0.579 (p < 0.01), which shows the organizational commitment has significant impact on the turnover intention.

In Figure 4, the structural equation model is mainly used to test the regression relationship of the turnover intention to the two dimensions of psychological contract and organizational commitment, according to the analysis results of

Figure 2. The model of the relationship between psychological contract and organizational commitment.

Figure 3. The relationship between organizational commitment and turnover intention.

Figure 4. A model of the relationship between psychological contract, organizational commitment and turnover intention.

Amos statistical software, this model’s fit indexes are as follow: χ2/df = 2.328, NNFI = 0.093, IFI = 0.956, CFI = 0.942, RMSEA = 0.068, all reach or are close to the standard value of all indexes’ fitted values in structural equation model 4, it shows that this model’s fitting degree is acceptable. The test results of this structural equation model show that the standard regression coefficient of the depen- dent variable turnover intention to the transactional psychological contract is −0.160, except for it, the rest standard regression coefficient of the other variables all are significant at the 0.01 level.

Based on the above research, the results obtained are as follows: first, in the model 1, the regression coefficients of the dependent variable turnover intention on the transactional psychological contract and relational psychological contract, these two dimensions of psychological contract, are −0.223 and −0.488 respectively, both are significant at the 0.01 level, which prove the hypothesizes H1a and H1b in H1, namely the two the dimensions of the psychological contract (transactional psychological contract and relational psychological contract) have significant and negative effects on turnover intention, and the influence of the relational psychological contract on turnover intention is the most significant. Second, in the model 2, the regression coefficient of dependent variable organizational commitment to transactional psychological contract and relational psychological contract are 0.268 and 0.605 respectively, and both are significant at the 0.01 level, so the hypothesizes H2b H2a in H2 are proved, namely the two dimensions of psychological contract (transactional psychological contract and relational psychological contract) have significant impacts on organizational commitment. Third, in the model 3, the regression coefficient of turnover intention to organizational commitment is −0.579, and is significant at the 0.01 level, too, which proves the hypothesis H3, namely organizational commitment has a significant and negative effect on turnover intention. Last, in the model 4, we make regression analysis of the dependent variable turnover intention to the mediating variable organizational commitment and the independent variables transactional psychological contract and relational psychological contract at the same time, the regression coefficient of organizational commitment is −0.287, it is significant at the 0.01 level. The regression coefficients of transactional psychological contract and relational psychological contract are decreased compared with the results of model 2, and the regression coefficient of transactional psychological contract is reduced from −2.223 reduced to −0.106, and the significance level changes from 0.01 level to insignificance; the regression coefficient of the relational psychological contract is reduced from −0.488 to −0.236, its significance remains at the 0.01 level. According to the decision criteria of the mediating variables, the psychological contract plays a mediating role in the relation between organizational commitment and turnover intention, and the organizational commitment plays a partial mediating role between transactional psychological contract and turnover intention, plays a full mediating role between relational psychological contract and turnover intention, so we prove the hypothesis 4.

5. Conclusions and Suggestion

5.1. Conclusions

First, the previous study on the psychological contract and employee turnover is from the perspective of social exchange or equity; this study introduces the resource conservation theory, and interprets the effect mechanism of the psychological contract on turnover intention from a brand-new perspective. Consisting with the research conclusions of Tumley and Feldman, the two dimensions of psychological contract (transactional psychological contract and relational psychological contract) both have a significant negative impact on employee turnover intention. At the same time, we also find that the effect of relational psychological contract on employee retention is greater than the psychological contract of transaction. To a certain extent, it shows that the influence of the transactional contract such as the salary and welfare on the employee’s turnover intention is gradually reduced, and the employee may pay more attention to the establishment of relationship contract with the enterprise. So when the enterprise establishes psychological contract with employees, it ought to pay more attention to the demands of the employee's relational contract, so as to reduce the employee's turnover intention.

Second, the scholars have different opinions on the mechanism of psychological contract on employee’s turnover intention; some scholars believe that the psychological contract has a direct impact on the employee’s turnover intention; others believe that the psychological contract indirectly influences employee’s turnover intention through some mediating mechanism. We examined the mediating role of organizational commitment between psychological contract and turnover intention; the results of the study shows that organizational commitment plays a full mediating role in the relationship between transactional psychological contract and turnover intention, and plays a partial mediating role in the relationship between relational psychological contract and turnover intention.

Last, the results of this study are consistent with the theory of resource conservation. Hobfoll (1998) thought that when the organization provides valuable resources for the individual, such as the superior guidance, support, competitive salary, welfare, etc., the individual’s commitment to the organization will be improved. Research shows that when the individual receives the supportive resources from the organization, it will establish the employee’s organizational commitment and trust, and thus reduce the possibility of turnover behavior [18] . Conversely, if employees do not feel the support of organizational resources, it will produce a negative performance, such as job burnout or turnover behavior. For example, some studies have found that employees’ perceptions of organizational politics will reduce their perceived organizational support, which will make them think that the resources they pour into the organization will not be repaid accordingly, and reduce the initiative of investing additional resources, which will lead to the negative working attitude and performance behavior [19] [20] .

5.2. Suggestion

Based on the conclusions of this paper, we put forward the following management recommendations:

First, when the enterprise wants to make a contract with employee, it needs to pay more attention to the employee’s appeal of psychological contract in the management practice; managers shall pay attention to the maintenance of the employees’ relation resource. The supervisor shall provide the employees with timely feedback on the work and give proper guidance and support to the employees, and devote to building a harmonious and friendly working atmosphere, so as to maximize the reduction of the employees’ turnover intention.

Second, because organizational commitment play an important mediating role in relationship between employees’ psychological contract and employees’ turnover intention, the supervisor should not only pay attention to the employees’ psychological contract, but also enhance the employees’ organizational commitment, through the synergistic effect of both, it can effectively improve the employee’s turnover problem.

Funding

The Ministry of Education of Humanities and Social Science Project, China (No.66zy1402).

Cite this paper

Wang, Y. , Li, Z. , Wang, Y. and Gao, F. (2017) Psychological Contract and Turnover Intention: The Mediating Role of Organizational Commitment. Journal of Human Resource and Sustainability Studies, 5, 21-35. doi: 10.4236/jhrss.2017.51003.

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