Social and economic exchanges with the organization: do leader behaviors matter?

The purpose of this paper is to investigate the extent to which leader behaviors (authentic, directive, and transactional) predict subordinates' conceptualization of exchanges with their organization (i.e. social and economic exchanges).

Data were collected from 165 employees in various organizations within the USA using questionnaires.

Results showed that authentic leadership was positively related to social exchanges. Further, directive leadership was positively related to economic exchanges. Contrary to the authors' prediction that transactional leadership would be a positive predictor of economic exchanges, transactional leader behaviors predicted both social exchanges (positive relationship) and economic exchanges (negative relationship). Several of the relationships between leader behaviors and follower exchange relationships were mediated by employee attitudes (i.e. job satisfaction) and beliefs (i.e. exchange ideology).

Further research is necessary to elucidate the reasons why leader transactional behaviors drive social exchanges, and through what mechanisms.

Organizations and practitioners can use these finding to select leaders who foster desired employee behaviors. Coaching or training efforts to develop authentic leaders may also be beneficial. Organizations and practitioners may benefit by implementing leadership training initiatives that develop managers' authentic leadership.

The paper's results position authentic and directive leader behaviors as positive and negative predictors of social and economic exchanges, respectively. It also identifies mechanisms through which leader behaviors influence employees' perceptions of exchanges.