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 Leadership & Organization Development Journal
The effects of empowering leadership on psychological well-being and job
engagement: The mediating role of psychological capital
Jong Gyu Park, Jeong Sik Kim, Seung Won Yoon, Baek-Kyoo Joo,
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LODJ
38,3
350
Received 24 August 2015
Revised 30 January 2016
14 May 2016
Accepted 16 May 2016
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Leadership & Organization
Development Journal
Vol. 38 No. 3, 2017
pp. 350-367
© Emerald Publishing Limited
0143-7739
DOI 10.1108/LODJ-08-2015-0182
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0143-7739.htm
The effects of empowering
leadership on psychological
well-being and job engagement
The mediating role of psychological capital
Jong Gyu Park
Department of Learning and Performance Systems,
The Pennsylvania State University, University Park, Pennsylvania, USA
Jeong Sik Kim
Business School, Sungkyunkwan University,
Seoul, South Korea
Seung Won Yoon
Department of Higher Education and Learning Technologies,
Texas A&M University-Commerce, Commerce, Texas, USA, and
Baek-Kyoo Joo
School of Business Administration,
Georgia Southwestern State University, Americus, Georgia, USA
Abstract
Purpose – The purpose of this paper is to investigate the effect of empowering leadership on employees’
psychological well-being (PWB) and job engagement. This study also examines the mediating role of
psychological capital (PsyCap) in these relationships.
Design/methodology/approach – The study draws on survey data (n ¼ 285) from employees in eight
large-sized firms in South Korea. Confirmatory factor analysis was conducted to examine the convergent
validity of the construct measures. Structural equation modeling was used to estimate the fit of the
hypothesized model to the data.
Findings – The authors found that empowering leadership influenced job engagement both directly and
indirectly through PsyCap. Employees’ PsyCap fully mediated the relationship between empowering
leadership and employees’ PWB, while partially mediating the relationship between empowering leadership
and job engagement.
Originality/value – This is the first empirical study to examine the effects of empowering leadership
behaviors of leaders on both PWB and PsyCap, which are positive psychological resources of employees.
The study has also provided empirical evidence for the importance of PsyCap, which plays a positive role in
the ability of employees to manage their overall feelings in achievement situations and in employees’
engagement in the workplace.
Keywords Psychological capital, Job engagement, Psychological well-being, Empowering leadership,
Positive organizational behaviour
Paper type Research paper
Introduction
Organizations today want and need employees who are emotionally connected to their
work and willing to do everything they can in order to support their organizations’
success. Leaders, believing that satisfied, capable, and committed employees are
their most important resource, take steps to enhance employees’ well-being and
job performance (Walumbwa, Peterson, Avolio and Hartnell, 2010). Consequently,
positive psychology has become a critical topic in the field of leadership and
organization development.
 According to Seligman and Csikszentmihalyi (2000), positive psychology is the scientific Mediating role
study of optimal functioning and what creates more value in human life. Grounded in of psychological
positive psychology, positive organizational behavior (POB) attempts to explain the role of capital
positive psychological states of employees in forming positive attitudes and behaviors
(Peterson, 2006). Psychological well-being (PWB) and job engagement are recognized as
important outcome variables of POB. PWB is concerned with emotionally focused positive
psychology (Luthans and Youssef, 2007), while job engagement, considered to be the 351
opposite of job burnout, is defined as a positive, work-related, and fulfilling psychological
state (Schaufeli et al., 2002). Employees with high levels of positive emotion are satisfied
with their jobs (Diener et al., 1999) and generate high levels of job performance (Wright and
Cropanzano, 2000). Furthermore, engaged employees perform better than less engaged
employees (Rich et al., 2010). Thus, employees’ PWB and job engagement are important
domains of leadership outcomes for today’s organizational leaders.
Leadership scholars point out that effective leadership encourages positive attitudes and
behaviors on the part of employees (Ashkanasy and Tse, 2000; Avolio et al., 2004).
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For instance, previous leadership studies have examined the relationship between
transformational leadership and PWB (e.g. Arnold et al., 2007; Nielsen and Munir, 2009;
Nielsen et al., 2008), authentic leadership and job engagement (e.g. Wang and Hsieh, 2013), and
the relationship between ethical leadership and job engagement (e.g. Chughtai et al., 2014).
Since leaders play a substantial role in the process of social influence within the organization
(Uhl-Bien, 2006), it is important to study how leadership impacts employees’ psychological
states of mind and behaviors.
Empowering leaders allow and encourage employees to control their own work
behaviors (Srivastava et al., 2006). Although the number of studies examining the promise of
empowering leadership has been increasing lately (e.g. Ahearne et al., 2005; Srivastava et al.,
2006; Zhang and Bartol, 2010), those studies largely focus on job performance (Ahearne
et al., 2005; Srivastava et al., 2006). Only a few studies examine the influence of empowering
leadership on aspects of the psychological state of mind such as trust (Ahearne et al., 2005)
and level of optimism (Segers et al., 2009).
In examining the relationship between leadership and the employees’ attitudes and
behaviors, this study postulates that positive psychological capital (PsyCap) is a mediator in
the relationship between empowering leadership and the two POB constructs of PWB and
job engagement. Luthans et al. (2005) regard PsyCap as positive psychological resources
that can be influenced by various organizational or leadership variables. Avey (2014)
empirically demonstrates that empowering leadership is a strong predictor of PsyCap.
PsyCap can also lead to desired individual outcomes such as PWB (Hmieleski and
Carr, 2007; Avey, Luthans, Smith and Palmer, 2010) and job engagement (Avey, Wernsing
and Luthans, 2008; Hodges, 2010). Since PsyCap is an individual’s positive psychological
state of personal development (Luthans et al., 2008), we expect that synergistic effects on
PWB and job engagement from PsyCap will result from leaders’ encouraging and
motivational behaviors through empowering leadership.
Despite the promise of PsyCap, relatively little is known about it, as Gooty et al. (2009)
have pointed out. This study aims to bridge the connection between organizational
leadership and positive psychology by reviewing definitions and core characteristics of
PsyCap and examining its role with regard to leadership and employees’ POB.

Review of the literature

Empowering leadership
Empowering leadership is defined as behaviors whereby power is shared with team
members, in turn raising all members’ intrinsic motivation levels (Srivastava et al., 2006).
Empowering leaders show four types of behaviors: emphasizing the significance of
 LODJ work, providing participation in decision making, conveying confidence that performance
38,3 will be excellent, and removing any bureaucratic constraints (Ahearne et al., 2005).
These leadership empowerment behaviors are based on the broad conceptualization of
empowerment posited by Conger and Kanungo (1988). They demonstrate that
empowerment is a motivational process rather than simply the delegation of power to
followers. Thus, to be empowering and to increase motivation as well, a team leader must
352 help team members understand the importance of their roles in the team, involve them in the
decision making process, believe them to be capable of achieving high performance, and
simplify administrative rules and procedures (Ahearne et al., 2005).
Previous empirical studies demonstrate considerable evidence for the positive relationship
between empowering leadership and various team and organizational outcomes, including
task performance (Ahearne et al., 2005; Srivastava et al., 2006; Vecchio et al., 2010),
job satisfaction (Konczak et al., 2000; Vecchio et al., 2010), commitment (Konczak et al., 2000),
and organizational citizenship behavior (Yun et al., 2007). Nevertheless, only a few studies
examine the influence of empowering leadership on the psychological state of employees.
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Because we feel it is important to understand how leaders influence employees’ states of mind
and organizational behaviors, we explore the relationship between leaders’ empowering
leadership and not only PsyCap, but also the PWB and job engagement of employees.

Psychological capital (PsyCap)

Today, many organizations try to increase PsyCap beyond financial capital (“what you
have”), human capital (“what you know”), and social capital (“who you know”) (Luthans
et al., 2004). PsyCap is more broadly defined as an individual’s positive state of development
regarding “who you are” and “what you can become” (Luthans et al., 2008, p. 223). Therefore,
PsyCap features the following characteristics: having enough self-confidence to take on and
successfully complete challenging tasks; having a positive outlook on how to be successful
now and in the future; demonstrating perseverance and flexibility in achieving goals;
and being able to remain steadfast in facing problems and adversity (Luthans, Youssef and
Avolio, 2007). Luthans and his colleagues found that PsyCap is a higher-order construct that
represents commonality among the four components listed above (Luthans, Youssef and
Avolio, 2007; Luthans et al., 2004; Luthans and Youssef, 2004).
Avolio et al. (2004) believe that PsyCap not only enables employees to commit to doing
their best in their jobs, but also promotes positive behaviors such as employees taking on
challenging work. To confirm this, it is important to investigate antecedents of PsyCap by
examining organizational or relational characteristics of the employees (Avey, 2014).
Previous studies show that leaders have significant impact on followers’ PsyCap (e.g. Avey,
2014; Gooty et al., 2009; Walumbwa and Schaubroeck, 2009). Hence, in this study,
we investigate empowering leadership as a key antecedent of PsyCap to contribute to a
better understanding of the nomological network of PsyCap.

Psychological well-being (PWB)

PWB is defined as “the striving for perfection that represents the realization of one’s true
potential” (Ryff, 1995, p. 100). PWB means that people will have high levels of positive
emotion and be satisfied with life in general. However, PWB is a multi-dimensional subject.
According to Brodsky (1988), PWB has four characteristics: subjective and emotional
aspects, a state as opposed to a continuous part of who we are, a product of personal
endeavor, and positive movement toward achieving goals rather than being negative and
involved in personal conflicts. Brodsky also describes several antecedents of PWB including
work environment, physical health, career paths, and a low level of stress. Ryff (1989)
identifies six unique dimensions of PWB: self-acceptance, positive relations, autonomy,
environmental mastery, purpose in life, and personal growth.
 The concept of well-being is getting more attention in today’s organizations. Mediating role
Being actively engaged in the job can make a person feel energized and generate positive of psychological
feelings of well-being (Schaufeli and Bakker, 2004). Furthermore, people who have a high capital
level of well-being feel good about themselves, trust their relationships with other people,
and feel they are on the right paths in their lives. They are also independent, can make up
their own minds, feel they are able to choose what is best for their personal needs, and have
specific objectives in life (Ryff and Keyes, 1995). 353
The concept of well-being is crucial for employees today, due to structural changes in
many organizations such as long-work hours and increased job complexity. Because PWB
leads to positive outcomes in both employees’ work and personal lives, scientific research on
this subject is becoming increasingly critical in the management field (Avey, Luthans,
Smith and Palmer, 2010). In this study, we examine employees’ PWB as an outcome of
empowering leadership and PsyCap, both of which are positive situational and
psychological resources for employees.
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Job engagement
Job engagement is a critical conceptual framework that connects employees with their
workplace. As is the case with PsyCap and PWB, the foundational and historical root of job
engagement is also positive psychology (Durán et al., 2004). Kahn (1990) conducted seminal
research to explain why individuals are personally engaged or disengaged in the workplace.
Kahn proposes the following definition of employee engagement: “the simultaneous
employment and expression of a person’s “preferred self” in task behaviors that promote
connections to work and to others, personal presence, and active full role performances”
( p. 700). Kahn’s view of engagement indicates a broad spectrum of employee engagement.
Maslach et al. (2001) take a complementary approach by analyzing why employees suffer
job burnout. They suggest that the antidote to job burnout is for employees to be actively
engaged in their work. Those authors define employee engagement as “a persistent,
positive, affective motivational state of fulfillment in employees that is characterized by
high levels of activation and pleasure” ( p. 417).
Many studies on job engagement to date have attempted to identify the key drivers of job
engagement. For instance, Schaufeli and Bakker (2004) find that job resources that act as
motivators result in job engagement, where engaged employees exhibit positive job attitudes,
exhibit good mental health, and perform better than those who are less engaged. Based on
Kahn’s (1990) engagement concept, Rich et al. (2010) report that the drivers of job engagement
are value congruence, perceived organizational support, and core self-evaluation. Among these
three drivers, perceived organizational support is related to supportive management and
trusting interpersonal relationships in the organization (Rich et al., 2010). Therefore, supportive
leadership from a supervisor can help increase subordinates’ engagement in their jobs.
According to Coffman and Gonzalez-Molina (2002), job engagement is one of the major
drivers contributing to enhancing an organization’s performance and growth. In addition,
job engagement helps companies survive in economic downturns (Amabile and Kramer,
2011). These empirical results support the idea that employees who feel psychologically safe
with empowering leaders and have self-confidence and a positive outlook are more likely to
engage in performing job roles. Thus, in this study we consider job engagement as an
outcome of both empowering leadership and PsyCap.

Proposed hypotheses
Empowering leadership and PsyCap
Leaders’ empowering leadership behavior will be positively related to the psychological
states of employees. Specifically, when a leader has a positive leadership perspective that is
 LODJ not directive but is participative, at times actively (Bass, 2000), leaders can positively
38,3 influence employees’ psychological resources. For instance, Rego et al. (2012) report a
positive relationship between authentic leadership and PsyCap, and similarly, Gooty et al.
(2009) find a positive relationship between characteristics of empowerment and individual
consideration from transformational leadership and PsyCap.
Empowering leadership characterized by positive leadership behaviors (Walumbwa,
354 Peterson, Avolio and Hartnell, 2010) leads to many positive outcomes. Empowering leaders
who raise team members’ intrinsic motivation using supportive behaviors have an impact
on employees’ positive affect (Srivastava et al., 2006). For example, previous studies
demonstrated that empowering leadership is positively related to a subordinate’s sense of
self-efficacy (Ahearne et al., 2005), employee optimism, and a hopeful outlook on life
(Segers et al., 2009). Leaders’ empowerment also enables employees to be resilient by
allowing them to be independent in their work (Luthans, Youssef and Avolio, 2007). Indeed,
empowerment seems closely related to the core factors of PsyCap: self-efficacy, optimism,
hope, and resilience (Avey, Hughes, Norman, and Luthans, 2008).
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Avey (2014) points out a lack of research on the antecedents of PsyCap and proposes that
effective leadership and supervision can positively influence the PsyCap of subordinates,
because encouraging and work-assisting behaviors (e.g. reducing uncertainties or barriers)
facilitate subordinates to build self-efficacy. To support his proposition, Avey (2014) tests
authentic leadership, ethical leadership, and empowering leadership as predictors of
PsyCap, finding that leadership is the strongest predictor. Walumbwa, Peterson, Avolio and
Hartnell (2010) suggest that integrated research is needed between PsyCap and positive
leadership styles such as empowering leadership in order to explore the interaction between
leaders’ behaviors and followers’ PsyCap. Based on these studies, we posit the first
hypothesis as the following:
H1. A leader’s empowering leadership will have a positive relationship with employees’
PsyCap.

Empowering leadership and PWB

Empowering experiences in their jobs directly influence the psychological states of
subordinates (Conger and Kanungo, 1988). Empowerment is a positive state of mind when
the path to achieving a goal is clear for employees and they have autonomy to achieve that
goal. In turn, they feel confident about being able to achieve their goals. A positive state of
mind leads to an increase in an employee’s PWB. As McGregor and Little (1998) and
Brunstein (1993) demonstrate, achieving personal goals is indicative of an individual’s
subjective well-being.
De Witte (1999) describes four specific job characteristics that correlate with PWB: skill
utilization, workload, job insecurity, and autonomy. An important aspect of autonomy is
one’s self-determination toward individual work behaviors (i.e. work pace and decision
making). Self-determination is an essential feature of empowerment, which in turn is
manifested as intrinsic motivation with the following characteristics: meaning, competence,
self-determination, and impact reflecting an individual’s orientation to his or her work role
(Thomas and Velthouse, 1990). Empowerment can also affect other job-related
characteristics of PWB, such as skill utilization and workload. In this vein, Heller and
Wilpert (1981) demonstrate that employees’ skill utilization is associated with participatory
decision making, which is one characteristic of empowering leaders (Arnold et al., 2000).
Thus, empowerment can be an effective means to maintaining job satisfaction and reducing
burnout when the employee’s workload is increased (Andrews et al., 2014).
Empowering leadership focuses on the relationship between leaders and subordinates, while
attending to individual psychological reasons for motivation (Thomas and Velthouse, 1990).
 In another study, Fitzsimons and Fuller (2002) show that having a sense of empowerment is Mediating role
associated with reduced psychological distress. They also report a positive association between of psychological
psychological empowerment and self-esteem. Molix and Bettencourt (2010) find that capital
psychological empowerment partially mediates the relationship between group identity and
PWB. In view of these findings from earlier research, we offer the second hypothesis:
H2. Empowering leadership will have a positive relationship with employees’ PWB.
355
Empowering leadership and job engagement
Leaders play a significant role in improving employee engagement (Mohammed et al., 2013;
Tuckey et al., 2012; Zhu et al., 2009). By employing an empowering leadership style, leaders
expect to create an engaged workforce that can take ownership of their jobs and know how
to complete work successfully. Empowering leaders encourage subordinates to experience a
high level of energy and meaningfulness in their work; in fact, job engagement emerges
when employees work with a high level of energy and strongly identify with their work
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(Schaufeli and Bakker, 2004).

Exploring job engagement in terms of the interaction between the self and his or her
assigned work role, Kahn (1990) argues that when employees feel that their work
boundaries are clear and distinct, they become more engaged. Further, employees feel
engaged when an empowering leader recognizes employees’ self-worth and roles at work,
such as when leaders share information and knowledge that enables employees to be more
productive (Ford and Fottler, 1995).
In their research, Tuckey et al. (2012) find that a fire brigade leader with an empowering
leadership style increased employee engagement in three dimensions: vigor, dedication, and
absorption. Bakar (2013) also reports that empowering leadership behaviors, such as
showing concern with regard to employees’ work and needs, affects employee engagement.
According to Walumbwa, Wang, Wang, Schaubroeck and Avolio (2010), employees are
likely to experience work engagement when they have feelings of empowerment from their
leader because such employees believe that they have autonomy and can impact group
performance (Spreitzer, 1996). Saks and Gruman (2014) proposed that empowering
leadership can influence employees’ engagement with task, work, group, and organization
through job resources, job demands, and the psychological conditions. These findings lead
to the third hypothesis:
H3. Empowering leadership will have a positive relationship with employees’ job
engagement.

Mediating role of PsyCap

To fully understand how leaders’ empowering leadership influences employees’ PWB and
job engagement, we should also consider the possible mediating role of employee
characteristics, especially related to individuals’ psychological assets. According to Mathieu
and Taylor (2006), there are three mediation models regarding organizational behavior: the
indirect effect model, which represents the independent variable related to the mediator and
the dependent variable related to the mediator, but with no direct relationship between the
independent and the dependent variables; the partial mediation model, representing
the direct relationship between the independent variable and the dependent variable
together with the mediated effect; and the full mediation model, where the direct relationship
no longer exists after the mediator is introduced into the model.
We developed H2 and H3 (i.e. the direct effect of empowering leadership on PWB and job
engagement) based on findings from previous studies. Nevertheless, few studies examine
our H1, i.e., the role of employees’ PsyCap in response to leadership styles (Avey, 2014).
 LODJ Walumbwa, Peterson, Avolio and Hartnell (2010) recommend that more research is needed
38,3 to investigate the relationship between positive leadership, such as empowering leadership,
and PsyCap. For the current study, we propose the partial mediation model because the
construct of empowering leadership is likely to influence dimensions of PsyCap to further
impact employees’ PWB and job engagement.
Previous studies demonstrate that PsyCap has a positive relationship with job performance
356 (Luthans et al., 2010), job satisfaction (Luthans, Avolio, Avey and Norman, 2007), and
organizational citizenship behaviors (Avey, Luthans and Youssef, 2010; Norman et al., 2010).
Many studies in regard to POB attest to the positive relationship between a positive outlook
and the well-being of individuals (e.g. Luthans and Youssef, 2004). For instance, Hmieleski and
Carr (2007) report a positive effect of PsyCap on PWB among entrepreneurs. Avey, Luthans,
Smith and Palmer (2010) showed that PsyCap is positively related with PWB over time when
examined longitudinally. Sweetman and Luthans (2010) propose a conceptual model of a
positive relationship between PsyCap and job engagement. In the same vein, Avey, Wernsing
and Luthans (2008) empirically demonstrate that employees’ PsyCap influences job
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engagement and organizational citizenship behaviors through the employee’s positive emotion.
In the PsyCap literature, several studies report its mediating role with regard to
leadership effectiveness. For example, Walumbwa et al. (2011) state that PsyCap and trust
mediate the relationship between authentic leadership (self-awareness, relational
transparency, balanced viewpoints, and ethical foundation) and process, as well as
performance outcomes within work groups. They further claim that collective PsyCap
mediates the relationship between both authentic leadership and group citizenship behavior
and performance. Gooty et al. (2009) also find PsyCap to be a mediator between the
followers’ perceptions of transformational leadership and employees’ performance and
organizational citizenship behavior. Luthans et al. (2008) demonstrate that PsyCap is
especially important in mediating the effects of a supportive organizational climate with
employees’ performance, job satisfaction, and commitment. Based on these findings, we
formed the following two hypotheses:
H4. Employees’ PsyCap partially mediates the relationship between leaders’
empowering leadership and employees’ PWB.
H5. Employees’ PsyCap partially mediates the relationship between team leaders’
empowering leadership and employees’ job engagement.

Methods
Sample and procedures
To test our hypotheses, we surveyed employees from large-sized firms in Seoul,
South Korea. A total of 400 employees from eight companies were selected to participate in
the study, of which 344 employees completed the survey. Of those 344, after cleaning the
missing data, 285 responses were included in the final analysis. Completed surveys were
returned directly to the researchers, and the data were kept anonymous and confidential.
In accordance with the relevant ethics codes in South Korea, written informed consent was
part of the data collection procedure.
In our sample of 285 respondents, 68.8 percent were male, and the mean age was
33.9 years. Classification by job types was as follows: 12.6 percent in marketing and sales;
5.6 percent in research and development; 9.5 percent in information technology (IT);
4.6 percent in support functions, such as planning, finance, accounting, human resources
(HR), legal, and general administration; and 24.6 percent in professional jobs, such as
certified public accountant (CPA) and management consultant. Classification by job level
was the following: 2.5 percent were executives, 15.4 percent were team leaders, 51.6 percent
were front-line supervisors, and 30.5 percent were employees below the supervisor level.
 Measures Mediating role
For all measures except for the demographic characteristics, we used a six-point Likert-type of psychological
scale, ranging from 1 (strongly disagree) to 6 (strongly agree). The language of the capital
instruments was Korean. First, the English versions of the empowering leadership scale,
PsyCap scale, PWB scale, and job engagement scale were translated into Korean by
the authors. Then, back translation into English was performed by a bilingual doctoral
student at a doctoral degree-granting institution. The English and back-translated versions 357
were compared. As a result, a preliminary Korean version was created after some
corrections for wording and meaning of each item in cooperation with another author.
In addition, two professionals with more than ten years of experience in management
reviewed and confirmed the clarity and face validity of all items.
Empowering leadership (α ¼ 0.93). Empowering leadership was assessed by 12 items
that were developed on the basis of the conceptual work of Conger and Kanungo (1988) and
the empirical work of Ahearne et al. (2005). Sample items were: “My manager helps me
understand how my objectives and goals relate to those of the company”; “My manager
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makes many decisions together with me”; “My manager believes that I can handle
demanding tasks”; and “My manager allows me to do my job my way.”
PsyCap (α ¼ 0.90). We used the PsyCap scale developed by Luthans, Youssef, and Avolio
(2007). Sample items from the scale include: “I feel confident in representing my work area in
meetings with management”; “Right now I see myself as being pretty successful at work”;
“When I have a setback at work, I have trouble recovering from it, moving on”; and
“I always look on the bright side of things regarding my job.”
PWB (α ¼ 0.80). PWB was measured with items adapted from Ryff and Keyes (1995).
Sample items from the scale are as follows: “In general, I feel I am in charge of the situation
in which I live”; “I have confidence in my opinions, even if they are contrary to the general
consensus”; and “I am quite good at managing the many responsibilities of my daily life.”
Job engagement (α ¼ 0.97). One popular measure for job engagement is the Utrecht Work
Engagement Scale (UWES; Schaufeli and Bakker, 2004), which measures the degree of
employees’ work-related behaviors around concepts of vigor, dedication, and absorption.
Newman and Harrison (2008) argue that measures of engagement have been criticized
because many have not fully captured Kahn’s (1990) conceptualization of engagement as the
degree to which individuals invest their physical, emotional, and cognitive energy into their
performance. Rich et al. (2010) note that the UWES includes items that confound
engagement with the antecedent conditions initially suggested by Kahn (1990). They
developed a new scale of measurement that aligns more closely with Kahn’s notion of
engagement as spanning physical, emotional, and cognitive dimensions. Thus, we measured
job engagement with 18 items adapted from Rich et al. (2010). Sample items include the
following: “I work with intensity on my job”; “I am enthusiastic in my job”; and “At work,
my mind is focused on my job.”

Analyses and results

To examine the hypothesized model, we used structural equation modeling (SEM) with
LISREL 8.72. Adopting Anderson and Gerbing’s (1988) comprehensive two-step analytical
strategy to test the hypothesized model, we first conducted confirmatory factor analysis
(CFA) to examine the convergent validity of our construct measures. Then we performed
SEM based on the measurement model to estimate the fit of the hypothesized model to the
data. It is noted that before testing the measurement and structural models, we averaged
items for each dimension of empowering leadership, PsyCap, PWB, and job engagement and
treated the different dimensions as separate indicators of their corresponding construct in
our SEM analyses.
 LODJ Factor analyses
38,3 Research involving cross-sectional data collected from a single source (e.g. employees only)
is vulnerable to common method variance (CMV) (Korsgaard and Roberson, 1995).
To assess the extent of method variance, we conducted a three-step process of analysis.
In the first step, we conducted exploratory factor analysis. Four variables – empowering
leadership, PsyCap, PWB, and job engagement – in the pooled sample were factor analyzed
358 utilizing a principal components method with varimax rotation. Using an eigenvalue greater
than 1 cut-off, nine factors could be justified and no general factor could be identified.
This result suggests that CMV was not operating at a level that would invalidate our
findings. According to Podsakoff and Todor (1985), the results of the exploratory factor
analysis performed above were utilized extensively.
The second step was conducting a CFA of our measurement model. CFA is most suitable
for confirming whether or not construct measures load on their respective priori-defined
constructs (Browne and Cudek, 1993). Table I presents the CFA results. As shown, the
baseline (hypothesized) model fit the data well ( χ2 ¼ 4,782.10, df ¼ 1,074, p o0.01;
CFI ¼ 0.95, NNFI ¼ 0.95, RMR ¼ 0.06). The range of factor loadings for the four factors was
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as follows: 0.62-0.78 for empowering leadership; 0.45-0.78 for PsyCap; 0.56-0.72 for PWB;
and 0.68-0.84 for job engagement.
Against this baseline model, we tested three alternative models. Model 1 was a three-factor
model with empowering leadership merged with PsyCap to form a single factor. Model 2 was a
two-factor model with empowering leadership merged with PsyCap to form a single factor, while
PWB and job engagement were merged into another factor. Model 3 was a one-factor model in
which all four variables included in this study were merged into a single factor. As Table II

Models Factors χ2 df Δχ2 CFI NNFI RMR

1. Baseline model Four factors 4,782.10 1,074 – 0.95 0.95 0.06

(hypothesized
model)
2. Model 1 Three factors: empowering leadership and 6,661.29 1,077 1,879.19** 0.94 0.93 0.08
PsyCap were combined into one factor
3. Model 2 Two factors: empowering leadership and 7,071.59 1,079 2,289.49** 0.93 0.93 0.08
PsyCap were combined into one factor;
PWB and job engagement were
combined into another factor
Table I. 4. Model 3 One factor: all the variables were 8,309.07 1,080 3,526.97** 0.92 0.92 0.10
Comparison of combined into one factor
measurement models Note: **po 0.01

Variables Mean SD 1 2 3 4 5 6 7 8 9 10

1. Gender 1.31 0.46

2. Age
3. Education
4. Job position
5. Job tenure
6. Job type
7. Empowering leadership
Table II. 8. Psychological capital
Means, standard 9. Psychological well-being
deviations, and 10. Job engagement
correlations Notes: n ¼ 285. Reliability
1.89 0.65 −0.26**
3.15 0.56 −0.02 0.25**
3.10 0.74 0.18** −0.66** −0.31**
2.15 1.23 −0.11 0.60** 0.13* −0.58**
5.46 2.11 −0.04 0.10 −0.00 −0.06 0.05
4.15 0.79 −0.13* 0.10 0.13* −0.25** 0.18** 0.07 (0.93)
4.52 0.61 −0.16** 0.14* 0.16** −0.19** 0.16** −0.03 0.55** (0.90)
4.56 0.59 −0.04 0.03 0.11 −0.08 0.11 0.05 0.40** 0.65** (0.80)
4.64 0.71 −0.14** 0.10 0.08 −0.18** 0.13* 0.04 0.59** 0.74** 0.58** (0.95)
coefficients for the scales are shown in parentheses along the diagonal. *p o 0.05; **po 0.01
 shows, the hypothesized model fit the data better than any of the simpler models in terms of Mediating role
model fit and error indices. The difference in the χ2 statistic between the baseline model and of psychological
alternative models were significant. These results provided evidence of the construct capital
distinctiveness of empowering leadership, PsyCap, PWB, and job engagement.
The third step was obtaining results from the Fornell and Larcker (1981) test
of discriminant validity between constructs. Following their suggestions, we tested the
discriminant validity of four variables by comparing the variance shared by each construct 359
and its measures with the variance shared by both constructs. To meet the requirements of
this test, the variance captured by each construct needed to be larger than 0.50 and larger
than the squared correlation between constructs. The variance-extracted estimates for
empowering leadership, PsyCap, PWB, and job engagement were 0.76, 0.55, 0.51, and 0.67,
respectively. Table II shows descriptive statistics, correlations, and reliability coefficients.
All exceeded the benchmark of 0.50 and the square of the correlation between constructs.
While these procedures did not eliminate the threat of method variance, it did provide
evidence that inter-item correlations were not driven purely by method bias (Korsgaard and
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Roberson, 1995).

Test of hypotheses
Structural modeling results suggested that the hypothesized model fit the data well
( χ2 ¼ 4,778.40, df ¼ 1,075, p o0.01; NNFI ¼ 0.95, CFI ¼ 0.95, RMR ¼ 0.06). We conducted a
series of nested model comparisons to assess the extent to which an alternative model would
result in a significant improvement in fit compared with the hypothesized model (Anderson
and Gerbing, 1988). The hypothesized model, or the baseline model, represents a partial
mediation model. We specified paths from empowering leadership to PsyCap and from
PsyCap to PWB and job engagement. This model also had direct paths from empowering
leadership to PWB or job engagement.
We compared the hypothesized model with an alternative model, which represents a
fully mediated model. In our comparative model, we deleted two direct paths from
empowering leadership to both PWB and job engagement. Table III summarizes the two
models’ fit indices. As Table III shows, the difference between χ2s was significant.
The results suggested that the hypothesized model indicated a better fit to the data than did
the alternative model.
Figure 1 presents the overall structural model with standardized path estimates.
H1 stated that empowering leadership is positively related to PsyCap. Our results supported
this hypothesis ( β ¼ 0.59, p o0.01). However, H2, which stated that empowering leadership
is positively related to PWB, was not supported ( β ¼ 0.06, pW 0.05). H3, which stated that
empowering leadership is positively related to job engagement, was supported ( β ¼ 0.23,
p o0.01).
In the SEM approach, partial mediation needs to meet two conditions: (a) the path from
the independent variable (empowering leadership) to the dependent variable (PWB and
job engagement) is significant; and (b) the paths between the independent variable
(empowering leadership) and the mediator variable (PsyCap), as well as the path between
the mediator variable (PsyCap) and the dependent variables (PWB and job engagement),
are significant ( James et al., 2006). If only condition (b) is met, a full mediation effect is
supported. H4 stated that employee PsyCap partially mediates the relationship between a

Models χ2 df Δχ2 CFI NNFI RMR

Table III.
1. Partially mediating (hypothesized) model 4,778.40 1,075 0.95 0.95 0.06 Structured equation
2. Fully mediating model 4,784.18 1,077 5.78 0.95 0.95 0.07 model comparisons
 LODJ
Psychological
38,3 Well-being
0.06

0.72**

0.59**
360 Empowering
Leadership
Psychological
Capital

0.65**
0.23**
Job
Figure 1. Engagement
Results of structural
equation modeling
Note: **p < 0.01
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team leader’s empowering leadership and an employee’s PWB. The structural coefficients
of the hypothesized, partially mediated model indicated that the relationship between
empowering leadership and PWB was non-significant ( β ¼ 0.06, p W 0.05), whereas
empowering leadership had a positive relationship with PsyCap ( β ¼ 0.59, p o 0.01) and,
in turn, PsyCap related positively to PWB ( β ¼ 0.72, p o 0.01). Although, the direct
relationship between empowering leadership and PWB posited by H2 was not supported,
the total indirect effect of empowering leadership on PWB was positive and significant.
Thus, H4 was supported.
H5 stated that employee PsyCap partially mediates the relationship between a team
leader’s empowering leadership and an employee’s job engagement. The structural
coefficients of a partial mediation model indicated that empowering leadership had a
positive relationship with job engagement ( β ¼ 0.23, p o0.01). Empowering leadership also
had a positive relationship with PsyCap ( β ¼ 0.59, p o0.01) and, in turn, PsyCap was related
positively to job engagement ( β ¼ 0.65, p o0.01). Therefore, H5 was supported.

Discussion and conclusion

Discussion
The purpose of this study was to investigate how empowering leadership affects the
positive psychological state of employees and how those two constructs influence
employees’ PWB and job engagement. Results showed that leaders’ empowering leadership
has a significant impact on employees’ PsyCap and also has a direct impact on employees’
job engagement. Additionally, PsyCap was found to be positively associated with both
PWB and job engagement. Unlike its partial mediating role between empowering leadership
and employees’ job engagement, PsyCap was found to fully mediate the relationship
between empowering leadership and PWB.
These findings imply that employees will form positive attitudes when leaders show
concern about the subordinates’ feelings and when they delegate authority (Culbertson et al.,
2010). We found that leaders’ empowering behaviors positively impact employees’ positive
state of mind towards their personal work and life. Most importantly, this study shows that
leadership, in combination with empowerment in the workplace, can contribute to the
enhancement of employees’ PWB and job engagement by increasing employees’ PsyCap.
This finding is aligned with the previous literature that reports a positive relationship
between PsyCap and PWB (Avey et al., 2010; Culbertson et al., 2010), and with job engagement
(Avey, Wernsing and Luthans, 2008; Hodges, 2010; Sweetman and Luthans, 2010).
 Findings from this study also clarified the role that PsyCap plays in regards to empowering Mediating role
leadership, PWB, and job engagement. of psychological
It should be noted that empowering leadership did not directly impact PWB, but PsyCap capital
fully mediated the relationship between empowering leadership and PWB. This finding
suggests that leaders’ empowering behaviors may have a more direct role in influencing
their employees’ level of PsyCap than PWB (Avey, 2014). One possible explanation can be
that leaders can make a greater impact on employee PsyCap that relates to employees’ 361
positive psychological resource capacities than on PWB, which is related to their overall life
satisfaction above and beyond work.

Theoretical implications
A few implications can be derived from the results of the study. First, the results
of this study expand the domain of empowering leadership and POB by revealing the
intervening mechanism of PsyCap. In response to calls for more research on PsyCap, we
structured our study to variegate contextual factors that can promote employees’
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PsyCap by testing leaders’ empowering behaviors (Avey, 2014; Walumbwa, Peterson,

Avolio and Hartnell, 2010). Based on the study results, we suggest that empowering
leadership is important for enhancing employees’ PsyCap, in turn enhancing
employee PWB and employee job engagement. That is, when leaders provide
empowerment, care, and encouragement focusing on the enhancement of employees’
positive psychological resource capacities, their influence toward employees’ PWB and
job engagement will be greater.
Second, one of our primary goals with this research was to further delineate the
positioning of PsyCap in the nomological network of leadership and employees’ positive
outcomes. In doing so, we assumed that a direct relationship exists between empowering
leadership and PWB and job engagement with the mediated effect of PsyCap.
Furthermore, we considered the role of PsyCap acting as a partial mediator in the
relationship. However, in our study, PsyCap fully mediated the relationship between
empowering leadership and PWB, while playing a partial mediation role with job
engagement. These findings indicate that leaders’ direct efforts to assist with employees’
autonomy and personal growth can be less than successful, but their support of the
subordinates’ self-confidence and perseverance is important for employees to become
more autonomous and purposeful. The findings also support the efficacy of leaders’
empowering behaviors in boosting employees’ POB.

Practical implications
Our study showed that, to improve the employees’ job engagement and PWB, employees
need to feel safe, confident, persevering, and flexible, and for that matter, leaders’
empowering behaviors play a significant role in boosting the followers’ psychological
safety. Although many leaders and managers encourage their subordinates to be more
autonomous and participatory, we believe that conveying confidence and collaborating with
them to reduce work barriers are less frequently practiced in today’s workplace. Workplace
learning and development professionals can incorporate such elements into leadership
training and coaching or mentoring arrangements.
Additionally, PsyCap is an important resource to form higher levels of PWB and job
engagement. As a concept of “who you are” and “what you can become” (Luthans et al.,
2008, p. 223), employees’ PsyCap needs more attention on the part of the leaders and
managers who interact closely with them. Today’s employees hear challenging messages
about the ever-shortening shelter life of acquired skills and are pressured to become more
innovative; these are uncharted paths in the fast-paced organizational life. As a concept that
focuses on instilling self-confidence, forming a positive outlook, and dealing with challenges
 LODJ through perseverance, flexibility, and resilience, PsyCap is an under-researched and
38,3 promising construct that can be leveraged by individuals who directly assist or interact
with the employees, particularly those who need to perform new and uncertain tasks.

Limitations and recommendations

This study has limitations to be acknowledged. The data sample of this research includes
362 professional workers (24.6 percent) such as CPA and management consultant. Howell and
Dorfman (1986) point out that there are differences between non-professional workers and
professional workers in their responses to leadership behavior. The data also includes
executives (2.5 percent) and team leaders (15.4 percent). If we assume that delegation
generally follows a hierarchy in the organization and moves top-down, the level of
empowerment or the extent of the effect of empowering leadership could also depend on a
respondent’s hierarchical level in organizations. Thus, it would be useful for future research
to compare differences between general staff (non-professional workers) and professional
workers in terms of the effects of empowering leadership.
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All data in this study were based on employees’ responses at the same point. Thus, our
results and findings are vulnerable to a concern about both common source variance and
common method bias. Although, we tried to alleviate the common method bias issue using
Harman’s single-factor test (Podsakoff et al., 2003), future research can address those
concerns by testing a longitudinal research setting with multi-source data sets.
We suggest further investigation which tests the effect of other leadership styles in
addition to empowering leadership in examining POB. Although Avey (2014) tested three
positive leadership styles – authentic leadership, ethical leadership, empowering leadership –
as antecedents of PsyCap, there are other domains left out in those leadership styles,
particularly about servant/sacrificial and spiritual behaviors. Future research should consider
various leadership styles which are not only positive leadership (e.g. servant leadership,
humble leadership) to enhance employees’ positivity, but also negative and/or ineffective
leadership behaviors to discourage employees’ positivity. Lastly, another fruitful research
topic will be analyzing PsyCap with four-facet constructs: self-efficacy, optimism, hope, and
resiliency (Luthans et al., 2007). This research effort will bring more elaboration on the
importance of PsyCap.

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About the authors

Jong Gyu Park is a PhD Candidate in Workforce Education and Development Program with emphasis
on Organization Development at the Pennsylvania State University. His research interests include
team leadership and leadership development in organizations. He also earned his PhD Degree in
Management from Sungkyunkwan University in Seoul, South Korea.
Jeong Sik Kim is an Assistant Professor in the Department of Business Administration at the
Daejin University. He received his PhD Degree in Business Administration from Sungkyunkwan
University. His current research interests include leadership, coaching, work motivation, decision
making, communication in organization, emotional labor, and psychological capital. Jeong Sik Kim is
the corresponding author and can be contacted at: jskim10@daejin.ac.kr
Seung Won Yoon is a Professor of Organization, Learning, and Technology in the Department of
Higher Education and Learning Technologies at the Texas A&M University-Commerce. He actively
serves on various leadership roles within the Academy of Human Resource Development. His research
focuses on improving workplace performance through connecting leadership, learning/knowledge
sharing, technology, and organizational behavior.
Baek-Kyoo Joo is an Assistant Professor of Human Resources Management at the Georgia
Southwestern State University, USA. He received his PhD in Human Resource Development and an
MA in Human Resources and Industrial Relations from the University of Minnesota. His current
research interests include positive organizational behavior, organizational creativity, leadership,
coaching, career satisfaction, and international human resources management. He has published
research papers in journals such as Human Resource Development Quarterly, Journal of Applied
Behavioral Science, Journal of Leadership and Organizational Studies, Leadership and Organization
Development Journal, and Personnel Review.

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