Envy: How Variability in Leader-Member Exchange Relationships Impacts Group and Individual Processes

Abstract

When employees are placed in groups at work, those groups provide a natural comparison point for the employees particularly with regard to the relationship each group member holds with the group leader (i.e., LMX quality). This phenomenon has been examined within the literature both at the individual- (relative LMX; RLMX) and group-level (LMX differentiation; LMXD). However, our understanding is underdeveloped due to the limited integration of social comparison theory to the phenomenon. To address this limitation, we develop theory on the group-level social comparison process to complement our understanding of the individual-level social comparison process. We also highlight a key affective mechanism that emanates from social comparisons – benign envy. As such comparisons occur, employees are envious of their (or their group’s) diminished position and motivated to improve their status (or their group’s) and perform better at work. Using a sample of 480 individuals nested within 90 groups, we find a parallel effect at both levels. Specifically, we find a positive indirect effect from RLMX to individual performance through individual benign envy and from LMXD to group performance through group benign envy. We also find that higher levels of leader prototypicality weaken the positive indirect effect from LMXD to group performance.