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A longitudinal field study, using corrected cross-lag correlations, investigated the causal inference relationships between perceived leader reward behaviour and subordinate performance, absenteeism, and work satisfaction in a controller's department of a merchandising organization. The results revealed that: (a) perceived positive leader reward behaviour served as a source of causation for subordinate performance and work satisfaction; (b) perceived punitive leader behaviour acted as a source of causation for subordinate work dissatisfaction; and (c) subordinate performance and absenteeism served as sources of causation for perceived punitive leader behaviour. The results support the belief that perceived performance-contingent rewards given by the leader can be a significant influence on subordinate attitudes and behaviour.