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In this study the effects of three key factors (affect, loyalty, and contribution) of the manager-subordinate exchange relationship on two types of reward decision (monetary rewards and nonmonetary incentives) were examined. A policy-capturing approach of 2×2×2 within-subjects of scenario experiment design was used to examine the effects of the exchange relationship factors on the corporate manager's reward decision in terms of a Taiwan-US comparison. Total valid samples were received from 204 Taiwanese and 172 U.S. managers. The results showed that Taiwanese managers allocate more rewards to subordinates with a closer affective relationship than do U.S. managers. Conversely, U.S. managers allocate more rewards to higher contributing subordinates than do Taiwanese managers. The limitations of the research are discussed and suggestions for further research are proposed.
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