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The International Journal of Human Resource Management Volume 20, 2009 - Issue 11: ‘Making Sense’ of HRM in China
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Selected Micro- and Macro- Studies

Effects of inter- and intra-hierarchy wage dispersions on firm performance in Chinese enterprises

Daniel Z. Ding Department of Marketing, City University of Hong Kong, Hong Kong, P.R. ChinaCorrespondence[email protected]
,
Syed Akhtar Department of Management, City University of Hong Kong, Hong Kong, P. R. China
&
Gloria L. Ge Department of Management and International Business, University of Auckland, New Zealand
Pages 2370-2381 | Published online: 10 Nov 2009
 
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Abstract

This study examined the impact of inter- and intra-hierarchy wage dispersions on company performance based on a sample of 395 Chinese enterprises. It was hypothesized that (1) inter-hierarchy wage dispersion between managers and workers is positively related to firm performance and (2) intra-hierarchy wage dispersion within manager and worker groups is negatively related to firm performance. Results based on regression analysis confirmed the first hypothesis and showed partial support for the second. Practical and policy implications are discussed in the context of China's transitional economy.

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