Association for Public Policy Analysis & Management

Leadership is seen as fundamentally important for improving public sector performance (Paarlberg & Lavigna, 2010; Oberfield, 2012; Wright et al., 2012; Van Wart, 2013), and the literature distinguishes between transformational and transactional leadership. Transformational leaders seek to transform their employees by raising their awareness of the importance of the vision (Bass 1985; Antonakis et al. 2003; Podsakoff et al. 2006), whereas transactional leaders use contingent rewards and sanctions with the aim of making employees perform better by appealing to their self-interest.

Performance can be defined as achievement of the objectives formulated by elected politicians in public organizations and by owners in private organizations, and the literature has made serious progress in terms of analyzing the short-term performance effects of transformational leadership (e.g. Bellé 2014). Existing studies have shown that randomly assigned leadership training can affect leadership behavior and that such training programs can positively affect employee performance (Dvir et al. 2002; Hassan et al. 2010; Kelloway et al. 2000). However, we lack knowledge about leadership effects in core public service delivery, and the existing leadership training studies focus only on transformational leadership. The research question in this paper is therefore how three types of leadership training (transformational, transactional and combined) affect leadership strategy and ultimately performance.

In line with existing studies (Lowe, 1996; Bass, 1999; Avolio et al. 2009; Dvir et al. 2002; Trottier et al. 2008; Wofford et al. 2001; Oberfield, 2012), we argue that both transformational and transactional leadership have the potential to affect leadership positively (especially in a combined version), and we conducted a large-scale experiment to test this without endogeneity.

The 500 participating public and private leaders come from core public service areas - daycare, education, and tax collection – and we also include leaders from private banks in order to make cross-sector comparisons. We obtain panel survey data from the participating leaders’ more than 10,000 employees and study how leadership training affects employee perceived leadership and self-reported performance.

Thus, the study will make three contributions: 1) study the effect of leadership training on leadership strategy, 2) investigate the effect of leadership on performance for core public services, and 3) as the first field experiment look at both transformational and transactional leadership strategies. Empirically, it will be an important result if we find that leadership training significantly affects leadership strategy and employee performance, but even a null finding on either the relationship between leadership training and leadership strategy or between leadership strategy and performance is relevant, because the literature strongly expects positive effects (Bass 1999; Avolio et al. 2009; Dvir et al. 2002).