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Linking Leader-Member Exchange and Employee Work Outcomes: The Mediating Role of Organizational Social and Economic Exchange

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  • Loi, Raymond
  • Mao, Yina
  • Ngo, Hang-yue

Abstract

This study presents and tests a framework that links leader—member exchange (LMX) with two different forms of employee–organization exchange: organizational social exchange and organizational economic exchange. We propose that these two forms of employee exchange with the organization would be the main mechanisms through which LMX affects employees’ affective commitment and intention to leave. We used structural equation modelling to analyze the data collected from 239 employees in a foreign-invested enterprise in China. Results showed that both organizational social exchange and organizational economic exchange acted as full mediators in the relationships between LMX and the two outcome variables but in different directions. Theoretical and practical implications are discussed.

Suggested Citation

  • Loi, Raymond & Mao, Yina & Ngo, Hang-yue, 2009. "Linking Leader-Member Exchange and Employee Work Outcomes: The Mediating Role of Organizational Social and Economic Exchange," Management and Organization Review, Cambridge University Press, vol. 5(3), pages 401-422, November.
    • Handle: RePEc:cup:maorev:v:5:y:2009:i:03:p:401-422_00
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    Cited by:

    1. Chow, Cheris W.C. & Lai, Jennifer Y.M. & Loi, Raymond, 2015. "Motivation of travel agents' customer service behavior and organizational citizenship behavior: The role of leader-member exchange and internal marketing orientation," Tourism Management, Elsevier, vol. 48(C), pages 362-369.
    2. M. Audenaert & A. Vanderstraeten & D. Buyens, 2012. "Mutual Investment Employee-Organization Relationship: A Conceptual Model of How and When it is Functional," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 12/778, Ghent University, Faculty of Economics and Business Administration.
    3. Chih-Ting Shih & Cheng-Chen Lin, 2014. "From good friends to good soldiers: A psychological contract perspective," Asia Pacific Journal of Management, Springer, vol. 31(1), pages 309-326, March.
    4. Stojanović Aleksić Vesna & Bošković Aleksandra & Stanisavljević Milena, 2016. "The Interdependence of Leader-Member Exchange Relation and the Leadership Style: Research in Serbian Organisations," Economic Themes, Sciendo, vol. 54(3), pages 363-383, September.
    5. Yidong Tu & Xinxin Lu, 2016. "Work-to-Life Spillover Effect of Leader–Member Exchange in Groups: The Moderating Role of Group Power Distance and Employee Political Skill," Journal of Happiness Studies, Springer, vol. 17(5), pages 1873-1889, October.
    6. Lalit Kumar Yadav & Nagendra Yadav, 2018. "Gender Stereotyping of Leadership," Paradigm, , vol. 22(1), pages 30-45, June.
    7. Alisher Tohirovich Dedahanov & Faridun Bozorov & Sanghyun Sung, 2019. "Paternalistic Leadership and Innovative Behavior: Psychological Empowerment as a Mediator," Sustainability, MDPI, vol. 11(6), pages 1-14, March.
    8. Haibo Wang & Xiaohui Wang & Jinrong Li, 2018. "Is new generation employees’ job crafting beneficial or detrimental to organizations in China? Participative decision-making as a moderator," Asia Pacific Business Review, Taylor & Francis Journals, vol. 24(4), pages 543-560, August.
    9. Raymond Loi & Long Lam & Ka Chan, 2012. "Coping with Job Insecurity: The Role of Procedural Justice, Ethical Leadership and Power Distance Orientation," Journal of Business Ethics, Springer, vol. 108(3), pages 361-372, July.

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