Leader-Member Exchange (LMX) and Innovation: A Test of Competing Hypotheses

In this paper, we address the relation between Leader‐Member Exchange (LMX; the quality of the relationship between leader and subordinate), employee creativity (the generation of novel and useful ideas), and employee innovation (the promotion and implementation of these ideas). In the current set of studies, we test the competing hypotheses that LMX will either have a direct effect on employee innovation, or an indirect effect through employee creativity. In a field study of leader–subordinate dyads (N = 118), we found that LMX had no direct effect on employee innovation, and that employee creativity fully mediated the relationship between LMX and innovation. In a follow‐up two‐wave field study of employees (N = 398), we found that the LMX dimension professional respect predicted innovation through creativity, while the other dimensions did not. The results of this work indicate that research on LMX and innovation requires a multidimensional perspective, and that it may be valuable to differentiate between creativity and innovation.