Journal of Management Development

Impact of psychological capital on organizational citizenship behavior: mediation by work engagement

Manish Gupta, Musarrat Shaheen, Prathap K Reddy,
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Manish Gupta, Musarrat Shaheen, Prathap K Reddy, "Impact of psychological capital on organizational citizenship behavior:
mediation by work engagement", Journal of Management Development, https://doi.org/10.1108/JMD-06-2016-0084
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 PSYCAP WORK ENGAGEMENT AND OCB 1

Abstract

Purpose – This paper examines the mediating role of work engagement (WE) between

psychological capital (PsyCap) and the two facets of organizational citizenship behavior

(OCB) which involves both individual and organization. It also examines the moderating role

of perceived organizational support (POS) between (1) PsyCap and WE, and (2) WE and the

two facets of OCB.

Design/methodology/approach – A total of 293 responses gathered from employees

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working in diverse service sector industries in India were assessed using structural equation

modeling.

Findings – Overall, the results support the mediating role of WE in the PsyCap – OCB

relationship, and the moderation of POS between WE and the two facets of OCB.

Research limitations/implications – This study helps in understanding how WE – OCB

relationship can be negatively affected in the presence of high POS.

Practical implications – The results encourage organizations to establish systems for

enhancing the engagement levels of their employees, which according to this study may be

achieved by creating and maintaining vibrant work environment.

Originality/value – This study helps in understanding the role of POS among PsyCap, WE,

and the two factors of OCB.

Keywords: PsyCap, organizational citizenship behavior, India, work engagement, perceived

organizational support.
 PSYCAP WORK ENGAGEMENT AND OCB 2

Introduction

In the era of globalization and utmost competition, organizations survive and thrive

on optimal utilization of their human resources (Seval and Caner, 2015). Therefore, it is

important for the organizations to identify the factors encouraging employees to volunteer for

activities beyond the call of their duties. Such discretionary extra-role behavior of employees

is called organizational citizenship behavior (OCB) which is of paramount importance for

organizational productivity and efficiency. Occupational psychologists believe that OCB is

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exhibited more by highly engaged employees because the engaged employees simultaneously

invest their cognitive, physical, and emotional energies in their work. Similarly,

psychological capital (PsyCap) is considered as a critical personal resource which facilitates

employees in the completion and achievement of official targets. This accomplishment of

task leads to a feeling of fulfillment and generate positivity among employees which

motivates them to engage in extra role behaviors.

Though scholars in the past have suggested linkage among PsyCap, work engagement

(WE), and OCB, little attention has been paid to examine the mediating role of WE between

PsyCap and OCB. Furthermore, there is a paucity of research about the effect of WE on the

two–factor model of OCB, which consisted of OCB toward individual (OCBI) and toward

organization (OCBO). Such studies are particularly important for the developing economies

like India, where skilled workers are merely 2% and the market is highly competitive

(Borpuzari, 2015). Several studies on India have recently observed justice, trust, social

responsibility, supervisory support, and employee–company identification as antecedents and

organizational commitment as a consequence of engagement at work (Gupta, 2015; Gupta

and Kumar, 2015; Gupta et al., 2015). Several extrinsic motivational factors that affect

engagement at work have also been explored in these studies (see Gupta et al., 2015b for
 PSYCAP WORK ENGAGEMENT AND OCB 3

details). However, studies on the relationship among WE, PsyCap, and OCB are sparse in the

Indian context, hence, the objective of this study is to investigate the mediating role of WE

between PsyCap and the two facets of OCB and the impact of POS on these relationships.

Theory and Hypotheses

Organ (1988) defined OCB as an individual’s voluntary behavior which cumulatively

helps in the organizational functioning, but is not explicitly or directly acknowledged by the

formal reward system. OCB has been classified in several ways. Some scholars have
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classified it based on the nature of these behaviors such as altruism–helping behaviors and

compliance behavior–sportsmanship and conscientiousness (Shaheen et al., 2016), whereas

others have classified it based on the recipient of these behaviors. In addition, Williams and

Anderson (1991) classified OCB into OCBI and OCBO based on the intended beneficiary.

The voluntary behaviors directed toward colleagues are called OCBI, and the behaviors

directed toward organization—punctuality and working overtime—are called OCB-O

(Shaheen et al., 2016). Former includes behaviors that have an immediate benefit specifically

on individuals, thus indirectly contributing to the organization, whereas the latter includes

behaviors that are directly beneficial for the organization instead of an individual.

OCB and PsyCap

Luthans (2002) studied about positive psychology, which advocated that positive

strengths and virtues of individuals have long term benefits. PsyCap is suggested to be a

composite construct of employees’ positive strengths and virtues (Luthans et al., 2007). On

examining the impact of frontline employees’ PsyCap in hospitality industry, Karatepe and

Karadas (2015) found that employees having high PsyCap are more satisfied with their job,

career, and life, because they are more optimistic, hopeful, resilient, and confident. PsyCap in

today’s dynamic workplace is suggested to be beyond human and social capital, as employees
 PSYCAP WORK ENGAGEMENT AND OCB 4

with high PsyCap can perceive what they are now by understanding their potentials and

strengths; these employees can also foresee what they are capable of becoming (Luthans et

al., 2015). They are full of positivity which encourages them to exhibit extra–role behavior

(Avey et al., 2008). Furthermore, Fredrickson (2001) posited that positive emotions broaden

individuals’ “momentary thought–action repertoires and build their enduring personal

resources, ranging from physical and intellectual resources to social and psychological

resources” (p. 219). Fredrickson (2013) employed broaden and build theory to suggest that

individuals reap benefits from these repositories and display positive behaviors. A meta–
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analytic study conducted by Avey et al. (2011) empirically reaffirmed the prior findings

about the positive impact of PsyCap on OCB.

Avey et al. (2008) examined the relationship between PsyCap and OCB, but they

explored only OCBI and not OCBO, which is another important dimension as per Williams

and Anderson (1991). Scholars have argued that PsyCap generates positive emotions and

individuals utilize these positive emotions “for proactive extra–role behaviors such as sharing

creative ideas or making suggestions for improvement” (Avey et al., 2011, p. 133). Thus,

employees high in PsyCap are expected to not only display extra-role behavior towards their

colleagues but also to engage in proactive extra-role behaviors towards their organization.

Therefore, the following hypotheses can be stated:

H1: PsyCap is positively related to OCBI.

H2: PsyCap is positively related to OCBO.

Mediating Role of Work Engagement

According to Schaufeli et al. (2002), WE is the extent to which employees show

enthusiasm, vigor, and dedication toward their work by finding meaning in their work role
 PSYCAP WORK ENGAGEMENT AND OCB 5

and being immersed in their work. Through dynamism, commitment, and absorption, the

employees physically, emotionally, and cognitively involve themselves in their work roles.

Conservation of resource theory postulates that individuals who possess resources are

capable of gaining more resources because of ‘gain spiral’ effect (Hobfoll and Wells, 1998).

The loss of resources leads to low morale and lack of motivation, whereas the gain of

resources leads to more absorption and immersion in task. While explaining the causal

relationship between PsyCap and work engagement, Sweetman and Luthans (2010) also
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suggested that employees having more resources are more capable and engaged in their work.

Similarly, Xanthopoulou et al. (2007) illustrated that personal resource partially mediates the

relationship between job resource and work engagement. PsyCap makes an individual more

persistent and committed toward the goal. Persistence and commitment means dedication and

engagement in task. WE is absorption in the task, and PsyCap provides necessary strengths

and abilities to remain engaged in task (Sweetman and Luthans, 2010).

The reason behind postulating that the engaged employees’ extra–role behavior is

based on social exchange theory which states that people tend to reciprocate the benefits that

they receive (Blau, 1964). Engaged employees based on their suitable work role attach

themselves to their organization which makes them feel happy. Moreover, these employees

like to reciprocate the benefits they receive from their organization in terms of facilitation of

identical values and supportive environment. It is the feeling of gratitude that drives the

engaged employees to go extra–mile and help their organization to grow. Since, their reason

for engagement is their work role, it is expected that they would demonstrate extra–role

behavior more towards the organization than to their co–workers.

Chiu and Tsai (2006) used 296 pairs of hotel staffs and found that burnout is

negatively related to OCB. Babcock–Roberson and Strickland (2010) conducted a study on

 PSYCAP WORK ENGAGEMENT AND OCB 6

the undergraduate students and found positive influence of higher WE on OCB, though OCB

was not conceptualized as intended beneficiary. Furthermore, Alfes et al. (2013) conducted a

study on service sector employees based on the hypothesis that OCBO is positively predicted

by work engagement. Very few studies demonstrate the presence of a positive relationship

between OCBI and WE (Tims et al., 2014) and found that WE positively influences task

performance and OCBI. However, in their model, they considered only OCBI and not OCBO

because their objective was to capture vocational behavior which is represented by OCBI. In

addition, Bakker et al. (2012) conducted a study on 144 employees to find that WE positively
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predicts both task performance and OCB.

Following the above discussion, there is a possibility of WE acting as a mediator

between PsyCap and the two factors of OCB. So, the following hypotheses can be stated:

H3: WE mediates the relationship between PsyCap and OCBI.

H4: WE mediates the relationship between PsyCap and OCBO.

Moderating Role of Perceived Organizational Support

On the basis of social exchange theory, Eisenberger et al. (1986) defined perceived

organizational support (POS) as employees’ relationship with their organization in terms of

the support employees perceive to have from their organization. This image in the mind of

employees is in the form of “organization’s legal, moral, and financial responsibility for the

actions of its agents; by organizational policies, norms, and culture that provide continuity

and prescribe role behaviors; and by the power the organization’s agents exert over individual

employees” (Rhoades and Eisenberger, 2002, p. 698).

 PSYCAP WORK ENGAGEMENT AND OCB 7

POS affects employees’ intention to put forth their efforts. The desired behavioral

outcomes are easy to achieve if employees perceive that their organization would recognize

their efforts and reciprocate the same (Eisenberger et al., 1990). They argued that individuals

with higher POS would attach themselves with their work to exhibit OCBO.

According to Shukla and Rai, (2014), positive self–belief would lead to less reaction

toward the reduction of organizational support and acknowledgement. But social exchange

theory suggests that employees maintain an exchange relationship with their organization.
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Employees have the tendency to withhold their efforts, if they perceive that their contribution

is not appreciated or acknowledged by the organization. Kurtessis et al. (2015) argued that

the discrepancy in this exchange relationship may prevent employees with high PsyCap from

investing their personal resources to get engaged in work and display proactive extra–role

behaviors. The perception about support and fair treatment from the organization has been

suggested to be closely related to employees’ cognition and disposition at the workplace.

Employees evaluate their current situation and create a self–perception about the support

from the organization. If the evaluation is positive, they immerse and engage themselves in

the work, and if it’s not positive then they withdraw their involvement (Cohen–Charash and

Spector, 2001).

Following the aforesaid arguments, POS fulfills Baron and Kenny’s (1986)

moderation criterion, according to which the moderator affects both the independent and the

dependent variables of the relationship. So, POS can be a possible moderator between WE

and the two facets of OCB as well as PsyCap and WE. Refer to Figure 1 for the hypothesized

model.

H5: POS moderates the relationship between PsyCap and work engagement.

H6: POS moderates the relationship between WE and OCBI.

 PSYCAP WORK ENGAGEMENT AND OCB 8

H7: POS moderates the relationship between WE and OCBO.

––––– FIGURE 1 HERE –––––

Method

Sample and Data Collection

Employees can rate their feelings better at the workplace, if they are familiar with

their organization and role. Therefore, only the employees who had been working for at least
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one year with their present organization (required for completion of at least one appraisal

cycle) in India were selected for the study. All the government bodies were excluded from the

study sample because we excluded the benefits received by employees in government

departments based on their performance. Human resources being the key competency for any

service industry, the data collection were restricted to the service sector companies only. On

one hand, restriction to services sector helped in defining the sampling frame well, but on the

other hand, no restriction on the types of industries within the services sector would help in

improving the external validity of the results. We maintained anonymity of the respondents to

obtain genuine responses and assured them about keeping their identity confidential. It was

also made explicit that their responses will be used solely for the purpose of research.

Out of the 600 respondents to whom either a paper and pencil or an online

questionnaire was initially administered, 350 were returned. However, few of them were

incomplete or did not meet the requisite criteria, hence, the final sample size was 293 of

which 37 responses were collected online and others were collected offline. The mean age

was 34.91 years, mean experience with current organization (CE) was 6.89 years, and mean

total experience was 8.19 years. The sample comprised of 62 female respondents. As per

industry, majority of them were from information technology enabled services (ITES)
 PSYCAP WORK ENGAGEMENT AND OCB 9

because in such settings social interactions are high and thus PsyCap is of paramount

importance (Avey et al., 2008; Avey et al., 2011) (refer Table 1).

–––––TABLE 1 HERE–––––

Measures

All the scales used in this study are well–established and reliable. All the items were

measured on a seven-point Likert type scale (1= strongly disagree to 7 = strongly agree).
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PsyCap was measured on a 12–item scale (Cronbach’s α > 0.70) of Luthans, Avolio,

Avey, and Norman’s (2007) (sample item: I feel confident presenting information to a group

of colleagues). WE was measured using a nine–item scale by Schaufeli, Bakker, and

Salanova’s (2006) (Cronbach’s α > 0.70; sample item: At work I feel bursting with energy).

OCBI was measured on a seven–item Williams and Anderson’s (1991) scale

(Cronbach’s α > 0.88; sample item: I help others who are absent). OCBO was measured on a

six–item Williams and Anderson’s (1991) scale (Cronbach’s α > 0.75) (sample item: My

attendance at work is above the norm).

POS was measured on an eight–item Rhoades et al.’s (2001) scale (Cronbach’s α >

0.90; sample item: My organization really cares about my well-being).

Age, gender, experience with the current organization and total experience were used

as control variables.

Data Analyses

Data were first subjected to exploratory factor analysis (EFA) with varimax rotation

to check if the same sets of constructs emerge in the present context. Subsequently, average

variance extracted (AVE), Cronbach’s alpha, and composite reliability values were calculated
 PSYCAP WORK ENGAGEMENT AND OCB 10

to establish reliability and validity of the scale. It was followed by estimation of Pearson

correlation coefficients.

For mediation and moderation tests, different models were tested and the differences

in terms of change in variance were calculated. After testing measurement model fitness, the

hypotheses were tested.

Results

EFA results largely indicated clear loadings except for two POS items that were
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removed in the subsequent analyses. These items were: My organization is willing to help me

when I need a special favor and My organization shows very little concern for me. AVE

values were found to be more than 0.5 for each construct, thereby indicating validity of the

scale. Furthermore, all the constructs were reliable as α–values exceeded the minimum

criterion of 0.70 (refer Table 1).

As shown in Table 2, the correlation coefficients between main variables showed

positive significance and ranged from 0.52 to 0.76. Initially, the measurement model

comprising of constructs under investigation was tested. The results indicated a good fit (CFI

= 0.90; RMSEA = 0.07; χ2/df = 2.60).

–––––TABLE 2 HERE–––––

Test for Mediation

 PSYCAP WORK ENGAGEMENT AND OCB 11

The first model was tested without the mediator and the direct relationships between

PsyCap and OCBI (β = 0.54, s.e. = 0.07; p < 0.001) as well as PsyCap and OCBO (β=.88,

s.e.=.08; p<.001) were found significant. These results supported hypotheses H1 and H2.

Considering WE as a mediator, the direct relationship between PsyCap and OCBO

became insignificant (β = 0.20, s.e. = 0.11, n.s.) but supported hypothesis H4. Contrary to

this, the direct relationship between PsyCap and OCBI showed significance (β = 0.35, s.e. =

0.11, p < 0.001). Also, Sobel, Aroian, and Goodman estimates were found insignificant by
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considering WE as a mediator between PsyCap and OCBI, thereby indicating the absence of

partial mediation, thus, disapproving hypothesis H3.

Test for Moderation

The relationship between WE and the two facets of OCB was tested by introducing

the interaction term POS×WE into the structural model. It was found that this made the

relationships between WE and OCBI (β = – 0. 22, s.e. = 0.14, n.s.) as well as between WE

and OCBO (β = 0.27, s.e. = 0.19, n.s.) insignificant. The interaction term was significantly

related with OCBI (β = 0.04, s.e. = 0.01; p = 0.002) and OCBO (β = 0.07, s.e. = 0.01; p <

0.001). These results supported hypotheses H6 and H7. However, moderation by POS

between PsyCap and WE was found to be insignificant, thus disapproving hypothesis H5.

The final model indicated a moderate fit (CFI = 0.87; RMSEA = 0.08; χ2/df = 2.89).

To interpret the moderation results in a better manner, the interaction curves were

drawn. As shown in Figure 2, the steepest line indicates that WE will have less impact on

OCBI for employees who perceive that their organization is highly supportive than those who

perceive that their organization is less supportive. Likewise, as shown in Figure 3, WE will

have less impact on OCBO for employees who perceive that their organization is highly

supportive than those who perceive that their organization is less supportive.
 PSYCAP WORK ENGAGEMENT AND OCB 12

The buffering effect of POS was such that high POS abates the relationship between

WE and OCBI as well as between WE and OCBO. It is possibly that engaged employees who

perceive their organization to be highly supportive feel that others also get similar support

from their organization, so, they tend to avoid OCB towards other employees. Another

explanation could be that on receiving (perceived) support from their organizations,

employees tend to care more about their specified role, as they are formally rewarded against

OCB, which is not explicitly or directly rewarded by the formal reward system.
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–––––FIGURE 2 and 3 HERE–––––

Discussion

The results of the present study are largely as per the expectations. A significant and

positive relationship between PsyCap and the two facets of OCB reaffirms the findings of the

previous studies, according to which, employees with high PsyCap are more efficacious and

positive and this leads to the exhibition of extra-role work behavior (Avey et al., 2011). The

positive relationship between PsyCap and WE confirms the earlier finding because

employees with high PsyCap are highly efficacious and resilient to the work challenges. They

are confident and optimistic about the work outcomes. The mediation of WE between PsyCap

and OCBO is one of the major contributions of this paper, which confirms that employees

display voluntary work behaviors towards organization only when they are committed and

engaged in their work. A committed and engaged employee will find the work interesting and

will have onus towards it (Sweetman and Luthans, 2010). Furthermore, POS is found to be a

significant moderator between WE and the two facets of OCB, which is another major

contribution of this paper. It explains when and how an engaged employee will be more

helpful and generous. Dedicated employees may find the extra-role behavior as deviation

from their work, but if they perceive that they are valued and cared by their organization, they
 PSYCAP WORK ENGAGEMENT AND OCB 13

will be more supportive and helpful to their colleagues and organization and will display

more altruistic and sportsmanship spirit. Moreover, according to the theory of positive

emotions, individuals reciprocate positive behaviors when they feel good and positive about

something (Fredrickson, 2001).

Few of the results are interesting. For example, there exists a significant positive

correlation of CE with WE, OCBO, and POS, whereas there exists a significant negative

correlation of TE with WE, OCBI, and POS. It could probably mean that engagement of
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employees in their work is dependent on their experience with the current organization and

not on their prior work experience. It could also mean that CE helps employees in perceiving

organizational support, whereas, an employee with prior work experience perceives

otherwise. Most interestingly, CE is positively related to OCBO, whereas, TE is negatively

related to OCBI, thereby, indicating that prior experience might actually create trouble in

exhibiting OCB toward the current organization.

The results augment the positive aspect of the self and role theory in many ways.

First, the findings provide empirical evidence about Sweetman and Luthans’s (2010)

conceptualization of the relationship between PsyCap and WE. Second, these results give

insight about the dimensions of OCB and augment the work of Avey et al. (2008) by

suggesting that PsyCap affects both the dimensions of OCB. Third, the results suggest that

WE mediates the relationship between PsyCap and OCBO but not the relationship between

PsyCap and OCBI, thereby suggesting that individuals with high PsyCap will display OCBO

and not OCBI when they are attached to their work. Fourth, the insignificant moderation of

POS between PsyCap and WE suggests that employees high in PsyCap are self-sufficient, as

they have both proactive (self-efficacy, hope, optimism) and reactive resources (resilience),

and the perception of support from their organization will not affect their current engagement

level (Shukla and Rai, 2014).

 PSYCAP WORK ENGAGEMENT AND OCB 14

Practical Implications

Owing to the popularity of WE amid practitioners due to its positive consequences on

performance, the results of the present study offer several implications for managers. First,

the positive association between PsyCap and WE may encourage managers to devise ways of

engaging their employees by setting reasonably challenging goals for them. Second, the

negative buffering of POS between WE and the two facets of OCB may encourage

organizations to establish systems for ensuring that organizational support does not make
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employees feel that they need not help their colleagues or work voluntarily for the benefit of

their organization. Third, the finding that WE has a mediating role between PsyCap and

OCBO but not between PsyCap and OCBI is of particular interest for practitioners because

OCBI refers to more attachment toward individuals who may leave the organization one day.

Managers would obviously like to see attachment of engaged employees more to the

organization instead of their colleagues. Therefore, to make employees work voluntarily for

the organization without any reward motif, managers may like to take steps to enhance

engagement levels in the company.

Limitations and Direction for Future Research

The results of this study are subjected to certain limitations. First, the sample excludes

employees having less than one year experience with their current organization. However, for

the purpose of measurement, the constructs under investigation require employees to

sufficiently familiarize themselves with their work and organization. Second, the cross-

sectional nature of study limits any true causal inferences. Scholars in the future may like to

capture the dynamism of this model by taking time lag as a key moderator.
 PSYCAP WORK ENGAGEMENT AND OCB 15

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 PSYCAP WORK ENGAGEMENT AND OCB 1

POS

OCBI

Work
PsyCap
engagement

OCBO
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Figure 1. The proposed PsyCap – OCB model

 PSYCAP WORK ENGAGEMENT AND OCB 2
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Figure 2. Interaction effect of POS and WE on OCBI

 PSYCAP WORK ENGAGEMENT AND OCB 3
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Figure 3. Interaction effect of POS and WE on OCBO

 PSYCAP WORK ENGAGEMENT AND OCB 1

Table 1: Particulars of the participants and variables (N = 293)

α Composite AVE Mean SD

reliability

Age 34.91 7.90

Experience (current organization) 6.89 6.56

Total experience 8.19 6.07

WE .93 .93 .61 5.13 1.16

PsyCap .93 .93 .54 5.38 1.05

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OCBI .88 .89 .51 5.10 1.02

OCBO .91 .91 .57 5.23 1.14

POS .92 .92 .70 4.62 0.80

 PSYCAP WORK ENGAGEMENT AND OCB 2

Table 2: Correlation coefficients (N = 293)

1 2 3 4 5 6 7 8 9

1. Age –0.02 .39** .35** 0.06 0.07 0.03 –.01 0.04

2. Gender .17** 0.11 –.04 –.02 0.04 0.1 0.06

3. Experience with the .14* .20** .19** 0.07 .15** .19**

current organization

4. Total experience –.12* –.11 –.13* –.06 –.14*

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5. WE .76** .52** .69** .71**

6. PsyCap .54** .64** .69**

7. OCBI .62** .55**

8. OCBO .72**

9. POS

Note: *p< .05; **p<.01