infonet-economy

This study explores the role of social comparison processes (SCP) in organizations. Unlike most SCP studies, we argue that SCP do not only take place on the individual, but also on the organizational unit level. Given the importance of procedural justice in headquarters-subunit alignment, we posit that organizational subunits engage in SCP with their peers on matters of procedural justice treatment by headquarters. We show that peer unit envy, as a negative consequence of SCP between subunits, negatively influences headquarters-subunit alignment. We further explore whether organizational socialization alleviates this effect by fostering a stronger organizational identification and rendering SCP on the subunit level less important. Contrary to theoretical predictions, however, we reveal socialization to have an aggravating effect, thus stimulating feelings of envy among subunits.