The Relationship of Locus of Control and Motives with Psychological Ownership in Organizations

Over the last eight years, researchers have begun to explore the idea that employees, who may or may not have financial ownership in a company, may develop a sense of psychological ownership of the company (Pierce et al., 2001, 2003). This psychological experience of ownership is not dependent on equity ownership and, in fact, may exist in the absence of any form of legal ownership. According to Pierce, Kostova, and Dirks (2001), psychological ownership refers to the state-of-mind where the individual feels as if the target of ownership (whole or part thereof) is his/her own. These authors argued that organizations could also be objects toward which individuals perceive psychological ownership. In such cases, employees feel possessive about the organization, get a sense of being psychologically tied or attached to it, and the organization becomes part of the employees' identity. While some research has examined the consequences of psychological ownership (Van Dyne and Pierce, 2004; Wagner et al., 2003), there is very little empirical research on the antecedents of psychological ownership. In order to increase our understanding of what causes psychological ownership, our study examines the role of two individual dispositional traits, locus of control and individualism. Pierce and colleagues (2001, 2003) have conceptually identified the motives underlying psychological ownership. However, their roles in affecting psychological ownership have not been empirically studied, to the best of our knowledge. Therefore, another purpose of our study is to verify if the effect of individual dispositions on psychological ownership is mediated by the motives underlying psychological ownership. LITERATURE REVIEW AND HYPOTHESES Psychological Ownership Organizational ownership as a psychological phenomenon was first theorized by Pierce, Rubenfeld, and Morgan (1991) in the development of a model of employee ownership. In that early model, psychological ownership was proposed as the outgrowth of formal ownership in the organization. In later work, Pierce and his colleagues (2001, 2003), drawing on work from sociology, philosophy, human development, and psychology, formally introduced a theory of psychological ownership in organizations that defined psychological ownership as separate and distinct from legal/equity ownership of the organization. Pierce et al. defined psychological ownership as "the state in which individuals feel as though the target of ownership or a piece of that target is 'theirs' (i.e., 'I am an owner and vested in this organization, it is mine! ')" (2003: 86). Later work by Mayhew, Ashkanasy, Bramble, and Gardner (2007) has expanded the concept of psychological ownership to include both job-based psychological ownership and organizational-based psychological ownership. These authors also found support for psychological ownership as a distinct construct from either job satisfaction or organizational commitment. Pierce et al. (2003) argued that psychological ownership would make people feel more responsible for workplace outcomes and some empirical support exists for the positive relationship of psychological ownership with increased productivity, organizational commitment, job satisfaction, involvement, and organizational citizenship behavior as well as a negative relationship with employee turnover (Parker et al., 1997; Pendleton et al., 1998; Pierce et al., 2003; VandeWalle et al., 1995; Van Dyne and Pierce, 2004). Drawing on the theory of psychological ownership in organizations that was proposed by Pierce and his colleagues (2001, 2003), the organization becomes the object toward which the individual perceives psychological ownership when it satisfies three motives of the employee: (1) when it provides opportunities to feel efficacious and in control; (2) when it becomes part of the self-identity where employees perceive ownership for the purpose of defining themselves; and (3) when it fulfills the desire to have a place that one calls one's own, analogous to the strong desire shared by most people to have a home. …