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Employee Performance and Mental Well-Being: The Mitigating Effects of Transformational Leadership during Crisis

Author

Listed:
  • Kristina Czura

    (University of Groningen)

  • Florian Englmaier

    (LMU Munich)

  • Hoa Ho

    (LMU Munich)

  • Lisa Spantig

    (RWTH Aachen)

Abstract

The positive role of transformational leadership on productivity and mental wellbeing has long been established. Transformational leadership behavior may be particularly suited to navigate times of crisis which are characterized by high levels of complexity and uncertainty. We exploit quasi-random assignment of employees to managers and study the role of frontline managers’ leadership styles on employees’ performance, work style, and mental well-being in times of crisis. Using longitudinal administrative data and panel survey data from before and during the Covid-19 pandemic, we find that frontline managers who were perceived as having a more transformational leadership style before the onset of the pandemic, lead employees to better performance and mental well-being during the pandemic.

Suggested Citation

  • Kristina Czura & Florian Englmaier & Hoa Ho & Lisa Spantig, 2023. "Employee Performance and Mental Well-Being: The Mitigating Effects of Transformational Leadership during Crisis," Rationality and Competition Discussion Paper Series 412, CRC TRR 190 Rationality and Competition.
  • Handle: RePEc:rco:dpaper:412
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    References listed on IDEAS

    as
    1. Czura, Kristina & Englmaier, Florian & Ho, Hoa & Spantig, Lisa, 2022. "Microfinance loan officers before and during Covid-19: Evidence from India," World Development, Elsevier, vol. 152(C).
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    4. Andrew Hertzberg & Jose Maria Liberti & Daniel Paravisini, 2010. "Information and Incentives Inside the Firm: Evidence from Loan Officer Rotation," Journal of Finance, American Finance Association, vol. 65(3), pages 795-828, June.
    5. Arjen Boin & Sanneke Kuipers & Werner Overdijk, 2013. "Leadership in Times of Crisis: A Framework for Assessment," International Review of Public Administration, Taylor & Francis Journals, vol. 18(1), pages 79-91, April.
    6. Boas Shamir & Robert J. House & Michael B. Arthur, 1993. "The Motivational Effects of Charismatic Leadership: A Self-Concept Based Theory," Organization Science, INFORMS, vol. 4(4), pages 577-594, November.
    7. Apostolos Davillas & Andrew M Jones, 2021. "The first wave of the COVID‐19 pandemic and its impact on socioeconomic inequality in psychological distress in the UK," Health Economics, John Wiley & Sons, Ltd., vol. 30(7), pages 1668-1683, July.
    8. Abi Adams-Prassl & Teodora Boneva & Marta Golin & Christopher Rauh, 2022. "The impact of the coronavirus lockdown on mental health: evidence from the United States," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 37(109), pages 139-155.
    9. Kashif Malik & Muhammad Meki & Jonathan Morduch & Timothy Ogden & Simon Quinn & Farah Said, 2020. "COVID-19 and the future of microfinance: evidence and insights from Pakistan," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 36(Supplemen), pages 138-168.
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    Cited by:

    1. Apostolos Davillas & Andrew M Jones, 2021. "The first wave of the COVID‐19 pandemic and its impact on socioeconomic inequality in psychological distress in the UK," Health Economics, John Wiley & Sons, Ltd., vol. 30(7), pages 1668-1683, July.

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    More about this item

    Keywords

    leadership; frontline managers; labor-management relations; organizational behavior;
    All these keywords.

    JEL classification:

    • M54 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Labor Management
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • J53 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Labor-Management Relations; Industrial Jurisprudence

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