Research Article: 2019 Vol: 18 Issue: 1
Bhawna Chahar, Manipal University Jaipur
The purpose of the article is to analyze the linkage of psychological contracts and with organizational citizenship behavior. To test hypothesis, data collected from 221 employees in Uttarakhand. Confirmatory factors analysis using SPSS software was carried out to identify factors related to psychological contract and Organizational Citizenship Behavior (OCB) of employees. Structural Equation Modeling (SEM) was conducted for analyzing the interrelatedness of psychological contract dimensions with Organizational citizenship behavior. Study indicates that psychological contract is related to organizational citizenship behavior of the employee. Our finding statistically confirms that different components of psychological contract are having influence on organizational citizenship behavior. The result is also uniform with the several other researches on psychological contract and its relationship with OCB. The research provides valuable insights for managers to understand the employee’s psychology towards various dimension of psychological contract and how much these factors affect in strengthening the organizational citizenship behaviour of employees.
Psychological Contract, Organizational Citizenship Behavior, Organizational Relationship.
Human Resource Management has witnessed a phenomenal growth and today, it is playing a key role in enhancing organisational competitiveness. It is playing multiple roles for complete growth and development of organization. The development of psychological contract has become important function of human resource management in any organization because it may help the employees and employers get rid of a complicated employment relationship (Sonnenberg et al., 2011). It does not help employer only in evaluating employees, but it contributes a lot in developing organization. The study on psychological contract has grown significantly in last few decades and is being used extensively now in Human Resource Management discipline. The psychological contract is utilised as one of the important tool to resolve many Human Resource (HR) related issues. In the present dynamic environmental condition, where the employees’ mobility has grown significantly and thought towards employee’s satisfaction as well as motivation are becoming insignificant, psychological contract has transpired as useful integrative concept with most of excising and emerging work place concern converge around it. Marks (2010) in his study revealed positive association among the employee’s Psychological Contract (PC) and Organizational Citizenship Behavior (OCB) of the employees in the organisation. The process of globalization, privatization, liberalization of economy, government deregulation of its policies, various technological improvement and technological innovations, social changes, political changes at national and international level, and many national as well as international economic events has given novel shape to employment trends (Todnem, 2005). Robinson & Morrison (1995) in their study on relationship between psychological contract and organizational citizenship behavior confirm that psychological contract has an impact on organizational citizenship behavior. As a result, the employees are forced to re check their psychological contract, which underlies their organizational relationship (Bellou, 2007). It was revealed that employees are more likely to perform better in certain work environments. Due to the changing employment relationship situation, a mental contract has been considered an important construct for explaining employment relationship. Continuing this, Robinson & Morrison (1994) explained that organizational citizenship behavior can be well described through psychological contract. Organizational Citizenship Behavior is gaining importance and drawn the attention of management professionals across the various industries. From these studies, we have indications that the construct of psychological contracts do have relevance for increasing our understanding of employee employer relationship from social exchange perspectives. As a consequence, an understanding psychological contract and their influence on organizational citizenship behavior is needed to be analysed. In the present paper, we first try to explore the construct of psychological contract and then start linking it to dependent variables i.e. organizational citizenship behaviour. The entire paper is structured in the following way. First a brief theoretical background regarding psychological contracts and organizational citizenship behavior and then then their interrelatedness is given. It was followed by objective and methodology. Thereafter, the empirical findings are presented. The paper ends with an analysis of the research findings, a discussion section and suggestions for further research.
The psychological contract concept originated in 1960 (Argyris, 1960) and further developed by American academician, Denise Rousseau. Denise Rousseau describes it as the existence of the understandings, beliefs and commitments of employees with the employer. Basically, it is a feeling of the employees which is not documented and it is very intangible in nature. The Psychological contract theory was proposed by Blau in 1964 and emphasis on developing social relationships, mutual obligations and power distribution (Blau, 1964). Similar work on construct related to social exchange theory used for organizational can be seen in the studies done by Argyris (1960), Levinson (1965), and Schein (1965:1978). Different authors have highlighted the Psychological contract in different ways, but mutual reciprocal relationship remained the central theme among all researchers (Rosseau & Tijoriwala, 1998; Atkinson 2002; Tekleab & Taylor, 2003). However, all idea behind the psychological contract emphasis on developing the employee’s positive attitude and better organizational citizenship behavior.
In general, the psychological contract is the individual’s perception of mutual obligations and expresses the mental picture of an individual obligation with counterpart obligation in a specific relationship (Rousseau, 2001). These obligations may be written or unwritten in the form of discussion. Several other authors like Rousseau (1989), Kickul & Lester (2001) have suggested the various dimension of psychological contract like relational contract, employer employee relationship, internal advancement, emotional affinity and transactional relationship.
These dimensions of psychological contract have relationship with cognitive response of the employee and thus strengthen the organizational citizenship behavior of employee (Hess & Jepsen, 2009).
Organizational Citizenship Behavior
The organizational citizenship is a perspective an employee has towards organization while extending his behavior beyond the normal duties of his/her position. In simple term, organizational citizenship behavior is the desirable organizational behaviors that explain the nature of relationship with positive organizational consequence (Walz & Niehoff (1996). Organ (1988) explained it as significant work behaviors that unfold behavior of individual beneficial to organization. Author emphasis that these behaviors are the matter of personal choice. Several literatures in the past have recognized the two-basic approach in behavior that is the role as well as extra role in describing OCB view. The research on dimension of organization citizenship behavior was carried out by Smith et al., 1983 and it was found that citizenship behavior consists of 2 dimensions. The first dimension is the altruism, or helping to specific persons, and second dimension is the generalized compliance which is more impersonal form of diligent citizenship. To my mind, for achieving better citizenship behavior, Organization needs to recognize the psychological contract employee carries with the organization (Byoung et al., 2014). Organizational Citizenship Behavior (OCB) was measure on the following dimension like Altruism, Courtesy, Conscientiousness, Civic Virtue and Sportsmanship (Organ, 1988; Williams & Anderson, 1991).
Psychological Contract and Organizational Citizenship Behavior
Most studies about association amongst psychological contract and organizational citizenship behavior indicated that when there will be resemblance of employer and employee in their expectation, the organizational outcome would be positive. Robinson & Morrison (1995) in their study on relationship between psychological contract and organizational citizenship behavior tested the relationship of two elements of PC i.e. Relational as well as Transactional Contract with five components of OCB (Altruism, Compliance, Sportsmanship, Courtesy, Civic virtue) and found that OCB is related to PC. Similar contribution were made by the other researcher like Argyris (1960); Rousseau (1989); Guest (2016); Van den Heuvel et al. (2015), Panaccio et al. (2015); Low et al. (2016), Karagonlar et al. (2016).
Creating positive work environment is the pre-requisite for the success of any organization. Several authors like Beardwell et al., 2004; Karagonlar et al., 2016; Low et al., 2016; Sparrow, 1998 believe psychological contracts are developed to bring constancy in the work environment strengthening the employee employer relations. Hui et al. (2004) in their study has tried to establish relationship between PC and OCB and finding suggested that out of transactional and relational contract, the relational contract have comparatively strong effect on citizenship behaviors. Kiazad et al. (2014) Panaccio et al. (2015); Chen & Kao (2012); Priesemuth & Taylor (2016); Coyle-Shapiro & Kessler (2000) believed when employee feel that organization meets their anticipations and emphasize upon establishing a long-lasting relation, the strong citizenship is reflected in their behavior. Similar study was undertaken by Bang et al. (2016) to examine Organizational citizenship behavior among primary school teachers in Taiwan by joining the two heterogeneous perspective, integration of factors related to OCB by usage of both perspectives organizational as well as personal. It was found that Expected Psychological Contract (EPC) moderate the Organizational Identification (OID) and organizational citizenship behavior (OCB). On reviewing the number of research paper nationally and internationally and critically evaluating them, the below mentioned hypotheses is proposed:
H0: The psychological contract has no significant impact on organizational citizenship behavior of employee.
H1: The psychological contract has significant impact on organizational citizenship behavior of employee.
Higher education institution has witnessed a phenomenal growth in the state of Uttarakhand and is playing an essential role in shaping the society and preparing human resources for maintaining the economy of the state as well as of the country. It is observed that most of the studies about Psychological Contract and its relationship with organizational citizenship behavior were done on western societies, and little is known about the service sector especially in academic sector organizations in India. Very few studies related to this topic is documented in the state of Uttarakhand. Organizational Citizenship Behavior is gaining importance and drawn the attention of management professionals across the various industries. Due to the changing employment relationship situation, a mental contract has been considered an important construct for explaining organizational citizenship behaviour. Therefore, the paper investigates the impact of Psychological Contract on Organizational Citizenship Behavior between employees working in different academic organization in Uttarakhand province of India. The broader problem under investigation will be to explore “How significantly psychological contract has affected Organizational Citizenship Behavior (OCB) of employees in academic organizations.”
Objectives and Methodology
In the dynamic business environment, the concept of psychological contract has drawn the attention of academicians and professionals significantly over the last few decades. The significant changes have been felt the circumstances such as technologies, increased competition, downsizing, demographic diversity, etc. and this has made the subject more complex. The situation in the academic organization is also becoming more complex and it is being acknowledged that the concept of the psychological contract can be applied to understand and manage the shifting employment relationships. The majority of research on psychological contract theory has been carried out on the dyad between the employer and the employee, and the reciprocal expectations and obligations they perceive. The present research work is aimed to know the impact of psychological contract on organizational citizenship behavior. The study has been taken up with the following objectives:
1. The level of psychological contract among the employees working with academic organization in Uttarakhand.
2. To explore the level of Organizational Citizenship Behavior of employees engaged with academic organizations of Uttarakhand.
3. To analyze Psychological Contract and its impact on Organizational Citizenship Behavior in academic organization in Uttarakhand.
To accomplish the objective of the study, descriptive research design is chosen. Primary as well as Secondary Data was collected for the study. Secondary data was collected from different sources like books, research journal, web resources, magazine and business data sources. Primary data was collected using questionnaire and survey method. The study area for the proposed research was chosen as Uttarakhand State. Uttarakhand is the state of educational hub in India. Presently there is one central university, 2 institutes of national importance, 11 state university, 16 private university and large number of private and Government College of higher education which are converting Uttarakhand into a model state to guarantee the all-round improvement of youth. The scenario of higher education in Uttarakhand is changing drastically. The population of the present study is the employees of academic organization in Uttarakhand. Non-probability sampling (convenient sampling) method was applied. Non-probability sampling method can help researchers in collecting data quickly and efficiently (Sekaran & Bougie, 2009). Furthermore, the non-probability sampling is advisable for theoretical generalizability of the subject (Calder et al., 1981). For collecting the data for the study, a structured questionnaire covering different dimension of PC and OCB was designed. The required sample size was chosen based on Hair et al. (1995) suggestions. Total questionnaire comprised of 26 questions relating to various psychological contract and 20 variables connected to the OCB and 6 questions related to demographic profile of the respondents. The strength of psychological contract and OCB was measured on scale as developed by Lee & Allen (2002), Revell (2012), Evers et al. (2000), Millward & Hopkins (1998) and Grimmer & Oddy (2007), Chaubey & Bist (2016), Bist et al. (2016). Employees were requested to rate the response on a 5-point Likert scale that was ranging from 1 to 5. 1 indicates strongly disagree and 5 indicates strongly agree. The researchers collected responses from 15 academic institution spread across the state of Uttaranchal. Total 250 questions were distributed, and 235 filled questionnaires were received from the respondents. After editing 221 responses were found fit and were taken for the study. The validity of the questionnaire was judged by an expert’s panel and faculty members, a pilot test of 30 respondents was carried out to check the reliability of the construct. Reliability check was carried out and value found to be 0.892, which suggested the acceptable level of reliability of the response from the questionnaire. After assuring the validity and reliability, a full-scale survey was carried out. Data was edited, coded and analyzed using SPSS 22. Data analysis was carried out using SPSS 22 software and Structural EQUATION MODELING (SEM) using AMOS 18 was carried out for analyzing pattern of relationship and model testing. Table 1 indicates the respondent’s demographic characteristics.
Respondent’s Demographic Characteristics
|Age||up to 30 years
30 to 40 years
Above 60 years
|Graduation and below
Upto Post Graduation
Post-Graduation with other professional specialization
|Income Level||Upto Rs.25000 PM ($350)
From 25000 to Rs.50000 PM ($351 to $700)
From 50000-75,000 PM ($701 to $1050)
75,000 to Rs.100000 PM ($1051 to $1400)
above 100000 PM ($1400)
The information presented in the above table indicates the demographic characteristics of the respondents. It was found that sample is dominated by respondents in the age group of 30-40 years as 55.7% respondent’s falls into this category. 32.1% respondents are in the age up to 30 years. More than two third respondents in Sample (68.3%) are male respondents. It is observed that 47.5% respondents are in the married categories respondents. Looking the education profile of the respondents, it is observed that sample is the reflection of good educated respondents as more than half of the respondents are education up to post graduated with professional specialization of doctoral degree to their credit. The information in relation to income level depicts that most of the respondents are earning up to Rs.50000 PM ($700) as almost 86.4% respondents falls into this category.
Structural Equation Modeling (SEM)
The Structural Equation Modeling (SEM) is a unique class of method focusing on testing hypotheses about the structural relationship between measured variables and latent constructs. This methodology have a preference by researchers and academicians as this method estimates the inter related and multiple dependence on a single analysis. It is used to examine the series of dependent relationship simultaneously by combining Multiple Regression with Confirmatory Factor Analysis (CFA). Structural Equation Modeling (SEM) has two mechanisms. First is measurement model that is used for assessing the reliability and validity of both variables Latent as well as Observed, and second is the structural model concerned with relationship and the path strength between the latent variable (Doloi et al., 2011). To test the model, it is recommended by some researcher that sample size should be approximately 200. A sample size of 191, continuous scaling techniques for measuring observed variables is taken, there was no violations of multivariate normality were obtained in survey response. All these pre-conditions are in line with the recommended for applying SEM (Medsker et al., 1994). A Confirmatory Factor Analysis (CFA) done by using AMOS 20 for testing the model of measurement. Figure 1 shows measurement model which consists of five constructs namely Relational Contract, Employee Employer obligation, Internal Advancement, Emotional Affinity and Transactional Relationship. These five constructs are measured by 24 measured indicator variables of psychological construct (Table 2). The reliability statistics was calculated using SPSS to evaluate the constructs internal consistency in the model that is applied. Each constructs level of internal consistency was acceptable, with alpha ranging from 0.603 to 0.824 that was found to be within the limit 0.60 (Hair et al., 1995).
Item Loading And Reliability: Descriptive Statistics
|PC16||I am committed to my team player and always try to be part of my team.||3.4712||1.10880|
|PC17||I am always ready to perform the task which is outside to my job requirements.||3.4503||1.10329|
|PC20||I promise to accept an internal transfer if required.||3.1623||1.17422|
|PC26||I always try to increase my participation in the decision making.||4.2408||.84890|
|Employer Employee Relationship||0.824||3.4195||.78051|
|PC1||Organization promises me to provide interesting and challenging work.||3.4241||1.12074|
|PC2||Organization has promised me to provide a practically safe and secure job and healthy work environment.||3.7330||1.18629|
|PC3||In this organization, Management motivate employee for mutual participation in the decision- making process.||3.4084||1.08129|
|PC4||My organization promises me to provide violence free and conducive work environment.||3.4869||1.16012|
|PC13||I am committed to my profession and render my services regularly even if I do not feel particularly well.||3.4450||1.19906|
|PC14||I remained loyal to my organization and always ready to work extra hours in case it is demanded.||3.3298||1.13374|
|PC15||I am polite to my customers even in situation where they are rude and unpleasant to me.||3.4031||1.10491|
|PC19||I promise to meet the performance expectations in my job.||3.2827||1.13028|
|PC11||I got an ample opportunity for getting promotion if I do hard work for the organization.||3.1990||1.21491|
|PC12||This organization provide me with good career development prospect and may career path are clearly map out.||3.4503||1.10329|
|PC21||I promise to provide the organization with innovative suggestions for improvement.||3.2565||1.05738|
|PC25||I always try to seek job assignments that would enhance my role||3.5969||.97322|
|PC23||I promise to work enthusiastically on jobs which others will prefer not to do.||2.8848||1.19090|
|PC24||I am emotionally attached with this organization and feel pride to be the part of this organization.||3.2094||1.15080|
|PC8||In this organization, each one is closely involved in their job.||3.6021||1.08035|
|PC 5||Money is the prime importance for me and I perform my task only for this.||3.4346||1.21164|
|PC6||This organization promises its employees to work in an exactly defined set of working hours.||3.4293||1.13970|
|PC9||This organization reciprocates the effort put in by its employees.||3.0942||1.16597|
|PC10||I perform my duty only that is barely required to be done.||2.9948||1.24180|
|Valid N (list wise)|
Since the data file had no missing values, the model was later converted into an imputed model (excluding the case no) to look like composite variable that was used to draw the path diagrams retain all its factor score value by taking a means of all latent constructs to make the model more presentable and lucid. Figures 2 and 3 shows the imputed model in Amos standardized and unstandardized estimates output with their path coefficients, correlation and R2 values.
Result of model fit summary presented in Table 3 indicates the CMIN value of 1.863 and p-value=0.000. The result of CMIN is derived from χ2/df reduces the impact of sample size on the Model. The CMIN value below 5 is considered acceptable model fit for the test statistics (Wheaton et al., 1977; Tabachnick & Fidell, 2007). Since our value is 1.863 which indicates the model fit. The outcome measure like NFI=0.948, TLI=0.969, CFI=0.975, GFI=0.961 and RMSEA=0.035 also indicate goodness of fit of model to data. Consciousness, civic virtue, courtsey and altruism account for 60.1%, 76.5%, 89.8% and 85.1% of the variance respectively as shown below (Table 4).
Model Fit Analysis Summary
|Various output of Model fit summary||Final Revised Model (Model 3)|
Squared Multiple Correlations: (Group Number 1-Default Model)
As discussed above the squares Multiple Correlation also called the R2 explains how well the independent variable explains the dependent variable. In our study we had four dependent variables namely Consciousness, Civic Virtue, Courtesy and Altruism, as show above Courtesy has been explained 89.8% which is the highest followed by Altruism 85.1% then Civic Virtue and finally Consciousness. All were explained by five independent variables namely Relational Contract, Employer/Employee obligation, Internal Advancement, Emotional Affinity and Transactional Relationship. In social sciences the value of R2 of 0.75, 0.50 and 0.25 are regarded as significant, moderate and weak respectively (Hair et. al., 2013). This value of R2 explains the constructs indicating the quality of adjustment model. Since CMIN/DF value is below 3 indicating a good fit and it is a general rule that if this value is below 3 all other parameters are usually in acceptable range.
Another important indicator is the RMSEA. The RMSEA value near to .05 or less indicates in relation to degree of freedom a close fit of the model (Arbuckle, 2005). It is an individual judgment and the value of 0.08 or less than this for the RMSEA show the rational approximation error. The value greater than 0.1 is undesirable for model fitness (Browne & Cudeck, 1993). In our research the value of RMSEA was 0.035 indicating a reasonable limit as RMSEA is a measure of badness of fit the value obtained can be acceptable.
The path coefficients of independent variables with their dependent variables, values less than .001 is significant at 90% confidence interval highlighted by *** (Table 5) it shows that Relational Contract is almost significant with Altruism 0.002. Employer Employee Relationship with its dependent variables was all significant except with consciousness. Emotional Affinity was also showing similar trends except its relationship with consciousness. If we observe carefully we see that consciousness is not having statistically significant relationship with any dependent variable except Transactional Relationship.
Regression Weights: (Group Number 1-Default Model)
|Civic Virtue||Relational Contract||.150||.061||2.451||.014|
|Altruism||Employer Employee Obligation||.231||.020||11.379||***|
|Courtesy||Employer Employee Obligation||.098||.015||6.565||***|
|Civic Virtue||Employer Employee Obligation||.386||.024||15.847||***|
|Consciousness||Employer Employee Obligation||.020||.029||.695||.487|
|Civic Virtue||Emotional Affinity||.106||.031||3.466||***|
|Civic Virtue||Transactional Relationship||.040||.032||1.250||.211|
The purpose of the study was to analyze the psychological contract and its effect on organizational citizenship behavior. The psychological contract that denotes employees’ implicit expectations of their employer is related to a range of work-related outcomes such as commitment, turnover intention and OCB (Lub et al., 2011). The results suggest Employer Employee Relationship with its dependent variables was all significant except with consciousness. Emotional Affinity was also showing similar trends except its relationship with consciousness. If we observe carefully we see that consciousness is not having statistically significant relationship with any dependent variable except Transactional Relationship. These findings agree with Rousseau (1998) who stated that the negative organizational outcomes may arise when the perceptions of their expectations and liabilities are different or one of them disturbs the agreement. Parker & Finkl (2002) also stated that OCBs will decrease when the PC is disturbed. In such cases, the interactive communication mechanism between the employer and employee is broken and they will reconsider whether to keep their promises or not. As mentioned, when the PC is disturbed, the organizational harmony and the effectiveness of the organizational operations will be damaged due to the fact that workers’ creativity, their willingness to be kept as organizational members. Theoretically this study supports the assumption that strength of different components of psychological contract develops the organizational citizenship behavior of the employees. The Knowledge about psychological contract is important for more accurate predictions about future citizenship behaviors needs to be taken into consideration for further studies and theory building (Bolino et al., 2012; Mitchell & James, 2001; Ployhart & Vandenberg, 2010; Singer & Willett, 2003) The findings are interesting for several reasons. First of all, these results support that employer employee relationship has strong effect on Altruism, Courtesy and Civic Virtue where as it is less effective in building consciousness. The present finding of the study is similar with the results of the studies conducted by Podsakoff et al., 2000; Wayne et al., 1997 in past in western societies. The result is consistent with the several other researches on psychological contract and its relationship with OCB (Malhotra & Murnighan, 2002, Gouldner, 1960; Hui et al., 2004; Cho et al., 2009; Hui et al., 2004). The primary hypothesis confirmed that psychological contract was found to be a good forecaster of organizational citizenship behavior. The results provided the evidence that different components of psychological contract such as Relational Contract, Employer Employee Relationship, Internal Advancement, Emotional Affinity and Transactional Relationship have different effect on organizational citizenship behavior of employees. Findings also support study undertaken in the past by Adam, John W consistent with that of findings of other studies done previously (Adams, 2011).
The results of this study showed positive correlation among the various components of Psychological Contract and Organizational Citizenship Behaviour of employees of higher educational institutes in the state. It was found that psychological contract is a strong predictor of organisational citizenship behavior. The strong positive relationship between psychological contract and organizational citizenship behavior calls management to ensure the fulfillment of psychological contract as to gain competitiveness. From the organisational behaviour perespective, the psychological contract provides opportunities to advance our understanding about work related needs which is essential for building strong human capital in the organsiation. It is suggested that management styles that fulfills employee intrinsic needs such as opportunities for personal development, proper management support, developing proper work environment should be incorporated for enhanced organisational citizenship behaviour. The paper contributes to organizational behavior literature like I provided evidence dissertation contributes to Organizational Behavior literature. The researcher has provided evidence for the psychological contract in various dimensions, namely Relational Contract, Employer Employee Relationship, Internal Advancement, Emotional Affinity, and Transactional Relationship of the 221 employee of academic organization. It is evident that these independent dimensions of psychological contract have impact on four dependent variables namely Consciousness, Civic Virtue, Courtesy and Altruism. As evident psychological contract have more effect on Courtesy followed by Altruism then Civic Virtue and finally Consciousness. The, the outcomes of this study will be of great value to management and well as Human Resource Practitioner for designing appropriate strategies for strong emotion bonding between employer and employee and will be helpful in strengthening citizenship behavior of employees. In spite of several rich contributions to the current literature, this research has also some limitations. Though researcher has tried to establish the relationship between the independent and dependent variable trough cross validation, better result could be achieved by following longitudinal research design for testing causal relationship of psychological contract and its outcome on OCB. Future studies should examine the generalizability of our finding in other organization in broader applications.
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