Still waters run deep: differences in employee empowerment between public and private sector firms in India

The different structural contexts of public and private sector firms frame the specific organizational work environment. However, public-private comparative studies have been unable to isolate how these differences influence aspects of organizational work, such as employee empowerment, with similarities and differences among key constructs. We develop a contingency view of employee empowerment, theoretically arguing and empirically demonstrating how authentic leadership with different levels of organizational politics influences employee empowerment in different contextual settings, namely public vs. private sector firms. We present evidence of a three-way interaction. We surveyed 173 senior Indian managers working in public and private sectors to measure their perceptions of empowerment, authentic leadership, and organizational politics. Employing ordinary least-square regression, we tested for simple and complex interactions. We found that authentic leadership had interactive effects on how organizational politics and public-private differences impact empowerment. The differences in the effect of authentic leadership on employee empowerment between public and private firms became more, with an increase in organizational politics.