An Exploratory Study on the Link between Managerial Discretion and Managerial Power

In order to clarify the definitions of managerial discretion and managerial power, two concepts that are often confused by extant literature since they are highly correlated and even overlapped with each other, and to further move the research progress forward in the two fields, the paper investigates the distinctions and connections systematically between the two by adopting the method of literature review and logic reasoning. Five main contributions are made by this paper. First, managerial discretion is wider and richer than managerial power in concept definition. Second, managerial discretion is less proactive than managerial power in running mechanism. Third, managerial discretion is mainly rooted in economic science, while managerial power is mainly rooted in management science. Fourth, managerial discretion is usually needed and used in dealing with strategic and innovative issues, while managerial power is usually linked to daily and repetitive issues. The last but not the least, there is an unbalanced interactive mechanism between managerial discretion and managerial power.