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Individuals’ economic value orientation or social equity value orientation? A dual value orientation in the process of house demolition compensation

Abstract The development of society and the economy has given rise to housing demolition. Using the psychological perspective of reference points, this paper studied the effects of tri-reference points (TRP) and social comparison on demolition compensation fairness perception through experiments in a demolished community. According to TRP theory, there are three special reference points (minimum requirements, status quo, and goal) when people make decisions. Our research finds that there exists a dual value orientation in the demolition compensation process: before the compensation amount reaches the status quo, the individual’s economic value orientation dominates; after achieving the status quo, a social equity value orientation dominates. In addition, the research results also show that demolished households pay the most attention to the minimum requirements of compensation; the fairness perception is very low below the minimum requirements, even when the compensation amount is the same or higher than that of others. Therefore, in the future implementation of compensation for demolition, the minimum requirements should be taken as the first priority. It is not necessary to arbitrarily increase the amount of compensation; it is better to set it between the status quo and the goal. Finally, ensuring that the demolished households are treated equally is very important.