Tightening the leash after a threat: A multi-level event study on leadership behavior following the financial crisis

By Janka I. Stoker, H. Garretsen, D. Soudis. Leadership Quarterly, 2019

125 citations recorded by the source corpus.

This paper presents the results of a multi-level event study of the effects of the 2008 financial crisis on leadership behavior. Following assumptions from the threat-rigidity hypothesis, we expect that across firms and countries, this crisis led to an increase in directive leadership. In line with this hypothesis, we also anticipate that this change is context-specific. The impact of the 2008 financial crisis on the change in directive leadership is analyzed for over 20,000 managers in 980 organizations across 36 countries. We find that the financial crisis went along with a significant increase in directive leadership, and that this effect was stronger in the manufacturing sector, and in countries with a high degree of power distance. Our results support the threat-rigidity hypothesis, and contribute to leadership research by showing that the context is not only a moderator but actually shapes leadership behavior. This opens up a new avenue of leadership research where context is an antecedent of leadership behavior more generally, and where the methodological set-up allows for causal inference.

Subfields: Accounting, Demography, Organizational Behavior and Human Resource Management

View Paper: https://www.semanticscholar.org/paper/37fc770a52e70de419bc2c45376f170c442bcfd8

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Citations in the corpus

Pandemics: Implications for research and practice in industrial and organizational psychology (2020, background): “Such research could attempt to constructively replicate a recent study based on the threat-rigidity hypothesis, which showed that the 2008 financial crisis led to an increase in directive leadership, particularly in the manufacturing sector and in countries with high power distance (Stoker et al., 2”
Leading and Working From Home in Times of COVID-19: On the Perceived Changes in Leadership Behaviors (2021, background): “Specifically, and following the literature, we focus on two behaviors that are highly relevant both in the context of a crisis (Stoker et al., 2019) and in the context of WFH (Bailey & Kurland, 2002; Clear & Dickson, 2005).”