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Impact of Psychological Capital on Innovative Performance

and Job Stress

Muhammad Abbas
Faculty of Management Sciences,
Riphah Intl University Islamabad Pakistan

Usman Raja, PhD

Faculty of Business (OBHREE), Brock University,
500 Glenridge Ave. St. Catharines, Ontario L2S 3A1 Canada,
Ph: +1 905 688 5550 ext. 3899; Fax: +1 905 641 8068

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Impact of Psychological Capital on Innovative Performance and Job


Research on positive organizational behavioral has explored the value added contributions of
psychological capital in predicting various workplace outcomes. Yet the relationship between
psychological capital and innovative job performance has largely been ignored. The current study
investigated the effects of psychological capital on supervisory-rated innovative job performance. The
study also examined the impact of psychological capital on job stress. Data collected from a diverse sample
of 237 employees, from various organizations in Pakistan, provided good support for the hypotheses. The
results indicated that psychological capital was positively related innovative job performance and
negatively related to job stress. High PsyCap individuals were rated as exhibiting more innovative
behaviors, by their supervisors, than low PsyCap individuals. Similarly, our findings also reveal that
individuals with high psychological capital reported lower levels of job stress as compared to their low
PsyCap counterparts.

Key words: Psychological Capital, Innovative performance, Job Stress

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Creativity and innovation have remained an important concern for organizations
as well as for researchers. The fast growing competition has intensified the need for
creativity and innovation in all domains of work. To gain competitive advantage firms are
now required to be innovative (McAdam & Keogh, 2004). Moreover, organizations
require innovative people to ensure sustainability in their competitive positions in the
market (Kanter, 1988). Considering the importance of innovations, extant research has
focused on contextual (Amabile, 1988; Carson & Carson, 1993; Shalley, 1991, 1995;
Staw, 1990) as well as dispositional (Barron & Harrington, 1981; Gough, 1979; Isena,
Daubman & Nowickia, 1987; Martindale, 1989) factors that stimulate innovative
behaviors among individuals.
Meanwhile, the development of psychological capital theory has provided an
important contribution to various domains of organizational behavior reserach. Derived
from the positive psychology research, psychological capital (PsyCap) has been found to
be related to various job outcomes (Larson & Luthans, 2006; Luthans, Avolio, Avey, &
Norman, 2007; Luthans, Norman, Avolio, & Avey, 2008).
Despite the potential of PsyCap in predicting various desirable job outcomes, little
attention has been paid to investigate its relationship with innovative job performance. In
a recent study, Sweetman, Luthans, Avey, & Luthans, (2010) investigated the
relationship between PsyCap and creative performance. However, these authors used a
creative exercise that was restricted to the idea generation phase of innovation and had
less relevance to job related innovative performance. Moreover, realizing their
limitations, these authors called upon future research to draw from alternative measures
of creative performance.

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Creative performance or creativity is, although, closely linked to innovative
behaviors, however, creativity is a starting point, while innovation includes different
steps of the successful implementation of creative ideas within an organization at
different levels (Amabile et al., 1996). Having said this and realizing the need for a more
composite measure of individuals innovation, we measure supervisory-rated innovative
performance using Janssens (2000, 2001) scale that covers almost all necessary phases
of individuals innovative behaviors.
The current paper extends the theory of psychological capital, predominantly
developed and tested in Western settings, in an Eastern setting. Thus, it provides external
validity to this theory. In addition, keeping in view the relevance of psychological capital
with creativity, innovation, and coping, we test for the impact of psychological capital on
supervisory-rated innovative performance and job stress. Although the field of innovation
is very broad, current study focuses on the adaptation of innovation at individual levels
which is conceived to encompass the generation, development, and implementation of
new ideas or behaviors at the job (Damanpour, 1991)
Researchers have emphasized the importance of conducting innovation related
research among organizations in emerging economies particularly in Asian settings
(Drazin & Schoonhoven, 1996: 1081). Since studies examining employee innovative
behaviors in non U.S work settings are rare with few exceptions including research
conducted in Bulgaria (Madjar, Oldham, & Pratt, 2002) and Taiwan (Farmer, Tierney, &
Kung-Mclntyre, 2003). Moreover, Asia has an important role in the global economy as
the MNCs are increasingly moving to Asian regions (Bartlett & Ghoshal, 1989) and
China and India are emerging as new competitors in MNCs innovative network (Bruche,

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2009). Drazin and Schoonhoven (1996) argue that the demand for U.S management
consultants and business school professors is increasing, thus providing an opportunity
for research and intellectual exchange across different cultures. Until the theories of
innovation are tested in non-U.S settings, the U.S researchers will have little confidence
about the generalizability of their models. Hence, given the importance of Asian settings,
investigation of employee innovative behaviors and its relation with psychological
capital, in Pakistan, is important.

Innovative Behaviors
The growing work demands to identify new ways of doing things have called
upon enhancing creative and innovative behaviors at the workplace. Creative and novel
ideas are the basis for innovations in organizations (Amabile, et al., 1996; Scott & Bruce,
1994; Woodman, Sawyer, & Griffin, 1993), which are required for nearly all jobs
(Shalley, Gilson, & Blum, 2000; Shalley & Gilson, 2004), for organizations of all types
(Damanpour, 1991) and are important for sustained organizational performance and
effectiveness (Nonaka, 1991; Oldham & Cummings, 1996; Zhang & Bartol, 2010).
According to Janssen (2004) innovative behaviors are defined as the intentional
creation, introduction, and application of new ideas within a work role, group, or
organization, in order to benefit role performance, the group, or the organization (p,
202). Creativity is although necessary but not a sufficient condition for organizational
innovation to operate. These innovative behaviors require a broad variety of cognitive
and socio-political efforts on the part of individuals (Kanter, 1988). Creative ideas are the
basis for all innovations (Scott & Bruce, 1994), which are developed, promoted,

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modified, and implemented by individuals (Van de Ven, 1986). Hence, exploration of
individual-level determinants of innovative behaviors is of high importance for both
theorists and practitioners.
An individuals innovative behaviors are composites of complex behavioral tasks
including idea generation, idea promotion, and idea realization (Kanter, 1988; Scott &
Bruce, 1994; Janssen, 2000, 2001), that are demonstrated in different stages of
development (Kanter's 1988) and are characterized by discontinuous activities (Kanter,
1988; Schroeder, Van de Ven, Scudder, & Polley, 1989); individuals may be involved in
any combination of these behaviors at any time (Scott & Bruce, 1994).
Moreover, all type of innovations start with idea generation phase that is, the
generation of novel and useful ideas in any domain (Amabile et al., 1996; Kanter, 1988;
Mumford, 2000; Woodman, Sawyer, & Griffin, 1993). The next phase is the idea
development that is, mobilizing support and acquiring approvals from peers and/or
supervisor to support the idea (Galbraith, 1982; Kanter, 1983, 1988). The last phase
relates to the idea realization, that is, transforming these ideas into useful applications
within a work role, a group, or the entire organization (Kanter, 1988).
At times, individuals may be required to spend substantial cognitive efforts in
generating, promoting, and realizing innovative behaviors (Janssen, 2004). Given their
demanding nature, these behaviors may have the potential to trigger stress among the
individuals. Similarly, the innovative behaviors involve creation of novel things, they are
change-oriented (Spreitzer, 1995; Woodman et al., 1993). Thus, individuals
psychological resources may be of high importance to be utilized in demonstrating
innovative behaviors.

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Psychological Capital
In recent years, organizational behavior research has taken a slight shift from
seeing individuals as coping with negative weaknesses to those enhancing their positive
strengths and well-being at the workplace. Seligman and Csikszentmihalyi (2000, p. 8)
posit that No longer do the dominant theories view the individual as a passive vessel
responding to stimuli; rather, individuals are now seen as decision makers, with
choices, preferences, and the possibility of becoming masterful, efficacious, or, in
malignant circumstances, helpless and hopeless.
Meanwhile, a growing body of positive-oriented research has advanced the
exploration of the wellness and wellbeing of humans in general and in particular to its
relevance to workplace. This body of knowledge includes Positive Organizational
Behavior (POB; Luthans, 2002a, 2002b; Luthans & Youssef, 2007; Luthans, Youssef, &
Avolio, 2007b; Nelson & Cooper, 2007) Positive Wellbeing (PWB; Wright, 2003, 2005;
Wright & Bonett, 2007), and Positive Organizational Scholarship (POS; Cameron &
Caza, 2004; Cameron, Dutton, & Quinn, 2003).
Derived from this line of thinking, psychological capital has emerged as a positive
oriented higher order construct (Luthans, 2002 a, 2002b; Luthans & Youssef, 2007). The
higher order psychological capital is defined as An individuals positive psychological
state of development and is characterized by:(1) having confidence (self-efficacy) to take
on and put in the necessary effort to succeed at challenging tasks; (2) making a positive
attribution (optimism) about succeeding now and in the future; (3) persevering toward
goals and, when necessary, redirecting paths to goals (hope) in order to succeed; and (4)

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when beset by problems and adversity, sustaining and bouncing back and even beyond
(resilience) to attain success (Luthans et al, 2007b: p. 3).
Positive psychological capital (PsyCap) has been found to be related to various
job outcomes such as job performance (Luthans, Norman, Avolio, & Avey, 2008;
Luthans, Avolio, Avey, & Norman, 2007), job satisfaction (Luthans, Avolio, et al., 2007),
job stress (Avey, Luthans, & Jensen, 2009), turnover intentions (Avey, Luthans, &
Youssef, 2010), cynicism (Avey, Wernsing, & Luthans, 2008), absenteeism (Avey,
Patera, & West, 2006) and organizational commitment (Larson & Luthans, 2006).

Theory and Hypotheses

Case for PsyCap and Innovative Performance
Considerable amount of research has focused on dispositional factors that may
stimulate innovative behaviors at the workplace. There are certain personality factors that
have been found to be related to creative behaviors at the workplace. These personal
factors include innovativeness (Flynn & Goldsmith, 1993), creative self-efficacy
(Tierney, & Farmer, 2002), extraversion (Furnham, & Bachtiar, 2008) openness to
experience (Feist, 1998, 1999; Furnham, & Bachtiar, 2008; George, & Zhou, 2001),
emotional creativity (Averill, 1999) and positive affect (Isen, Daubman & Nowickia,
Although few attempts have been recently made to investigate the relationship
between positive psychological resources and creativity, however, these resources have
been separately linked with creativity or innovation related outcomes. For example,
Rego, Machado, Leal, & Cunha, (2009) investigated the relationship between hope and

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creativity. Rego, Sousa, Marques, & Cunha (2011) investigated the relationship between
optimism and creativity. Similarly, Tierney, & Farmer, (2002) investigated the
relationship between efficacy and creative performance.
Despite this amplified attention, there has been only limited progress in
understanding the role of psychological capital in predicting innovative behaviors. Extant
theory suggests that positive psychological resources of efficacy, hope, resilience, and
optimism do not act in isolation, instead they provide support to each other through an
underlying shared mechanism (Fredrickson, 2001; Hobfoll, 2002; Magaletta, & Oliver,
1999; Youssef & Luthans, 2007), hence they should be studied collectively (Luthans,
Avolio, Avey, & Norman, 2007). Empirical research also supports the notion that
studying PsyCap as a core construct predicts job outcomes better than any of its
individual components (Avey, Luthans, & Jenses, 2009; Luthans, Avolio, Walumbwa, &
Li., 2005, Luthans, Avolio, Avey, & Norman, 2007; Sweetman, Luthans, Avey, &
Luthans, 2010).

Dimensions of PsyCap and Innovative Performance

To shed more light on the dimensions of psychological capital, their particular
relevance to workplace innovative behaviors and job stress, we now discuss the
components of psychological capital and their link with innovative behaviors and job
Hope: Hope is the first component of core psychological capital defined as a
positive motivational state that is based on an interactively derived sense of successful (1)
agency (goal-directed energy) and (2) pathways (planning to meet goals) (Snyder,
Irving, & Anderson, 1991, p. 287). Hope possesses the willpower to perform creatively

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and the waypower to creatively explore multiple pathways to reach the goals (Larson &
Luthans, 2006; Luthans, Youssef, & Avolio, 2007; Snyder, 2000; Snyder, Lapointe,
Crowson, & Early, 1998), thus, increasing the cognitive efforts towards goal attainment
(Snyder, 1994). According to Snyder et al. (1998) high hope individuals use agentic (goal
directed) thinking to move along a pathway and continuing to progress along. This
agency and pathway thinking is iterative in nature (see Snyder, Harris, et al., 1991).
Hope has been found to be associated with academic and athletic performance,
mental and physical health, and ability to cope with adversity (Snyder, 2000; Snyder,
Irving, & Anderson, 1991; Curry, Snyder, Cook, Ruby, & Rehm, 1997). High hope
individuals tend to be independent thinkers (Luthans, Youssef & Avolio, 2007). Hopeful
individuals tend to take risks and look for alternative pathways when old ones are
blocked (Snyder, 1994, 2002). Hopeful individuals seem more prone to work on creative
ideas for solving problems and they look at problems and opportunities from different
angels (Zhou & George, 2003). Luthans, Youssef and Avolio (2007, p. 74) have argued,
hopeful employees tend to be creative and resourceful, even with tight budgets.
Optimism: Optimism is the second positive resource capacity of psychological capital.
Optimistic individuals relate negative events as external (not my fault), unstable
(occurred this time only), and specific (this event only), while pessimists interpret the
same events as internal, stable, and global (Peterson, 2000; Seligman, 1998). Optimism
has been supported as a state-like, malleable construct that is open to development
(Seligman, 1998; Schneider, 2001).
Optimism is associated with a variety of individuals outcomes including
depression (Seligman, 1998), mental health (Seligman, 1998) burnout (Chang, Rand &


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Strunk, 2000). Optimists tend to maintain positive expectations about the results (Avey et
al., 2008). Optimistic individuals appraise daily hassles in a positive way by expecting
gain or growth from such events (Fry, 1995). These individuals have the ability to cope
with stress (Scheier, & Carver, 1985; Strutton, & Lumpkin, 1992)
Similarly, optimists keep on working hard and coping actively with the problems
they face while pursuing desirable outcomes. (Carver & Scheier, 1981; Kluemper, Little,
DeGroot, 2009). Optimists tend to take credit of and expect positive events in their lives
and distant themselves from unfavorable life events. Hence, it is less likely that these
individuals experience self-blame and despair when working on innovative solutions for
their problems. Recently, Rego et al. (2011) found that optimism had a direct positive
effect on creativity. Finally, Optimistic leaders pursue new and creative approaches
towards problems solving (Peterson, Walumbwa Byron, & Myrowitz, 2008).
Self-Efficacy: Relevant to the workplace, self-efficacy is defined by Stajkovic and
Luthans (1998b, p. 66) as the employees conviction or confidence about his or her
abilities to mobilize the motivation, cognitive resources or courses of action needed to
successfully execute a specific task within a given context. In a meta-analytic study,
Stajkovic & Luthans (1998a) found that self-efficacy had a strong positive relationship
with work-related performance (also see; Bandura, 2000; Bandura & Locke, 2003) even
in the absence of feedback (Judge, Jackson, Shaw, Scott, & Rich, 2007).
According to Bandura and Locke (2003), self-efficacy beliefs help to persevere in
the face of obstacles and cope with distressing and self-debilitating emotional states that
hinder in the execution of activities. Efficacious individuals are inventive, resourceful
(Bandura, 1986) as well as creative (Amabile, 1996; Tierney & Farmer, 2002).


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Resilience: Resilience is the fourth component of positive psychological capital defined

as the positive psychological capacity to rebound, to bounce back from adversity,
uncertainty, conflict, failure or even positive change, progress and increased
responsibility (Luthans, 2002a, p. 702). Resilient individuals have the ability to
positively cope and adapt during risk and adversity (Masten, 2001; Masten & Reed,
2002). According to Bandura and Locke (2003, p. 92) resilient belief that one has what
it takes to succeed provides the necessary staying power in the face of repeated failures,
setbacks, and skeptical or even critical social reactions that are inherently discouraging.
Even during highly changing and uncertain situations, resilience helps individuals to
become flexible and adapt themselves (Coutu, 2002). According to Tugade, &
Fredrickson, (2004) resilient individuals tend to bounce back from setbacks and difficult
Resilient individuals are optimistic, energetic towards life, curious, and open to
new experiences (Block & Kremen, 1996; Klohnen, 1996). These individuals are
humorous (Masten 1994; Werner & Smith, 1992; Wolin & Wolin, 1993), and use
creative exploration (Cohler 1987). Resilient individuals elicit positive emotions in
themselves as well as in others (Fredrickson, 2004) which may help them to create
supportive environment that facilitates innovative behaviors. These individuals have to
ability to positive adaptation and adjustment to change (Luthans, Youssef, & Avolio,
2007; Masten & Reed, 2002). Resilient leaders are likely to encourage themselves and
even their subordinates to take risks and to exhibit innovative behaviors (Peterson,
Walumbwa Byron, & Myrowitz, 2008)


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High PsyCap individuals are thought to put intentional efforts to produce creative
ways of attaining goals. Having relevance to positive organizational change,
psychological capital is considered as individual-level higher order factor that facilitates
change (Avey, Wernsing, & Luthans, 2008). Individuals high on PsyCap are able to
develop new path ways (hope) to attain their goals. These individuals possess the
confidence (efficacy) necessary to arrive at desired goals through these alternative paths,
have positive attribution and outlook for future (optimism) and are able to bounce back
from setbacks (resilience) in case of any difficulty or failure that may arise due to
implementing innovative ideas (Avey, Wernsing, & Luthans, 2008; Luthans et al., 2007).
It follows that these positive psychological resource capacities may help employees to
exhibit innovative behaviors by broadening the options they perceive, and helping them
to put on efforts to reach goals using their will-power and way-power even in the face of
initial failure and setbacks.
Although, the demands for creativity and innovation may provoke stress and
frustration among employees (Staw, 1995; Sweetman et al., 2010; Zhou & George,
2003), positive psychological capital has the potential to cope with these stressful
demands on one hand, and develop and implement innovative ideas on the other hand.
Even at the times of organizational change these individuals show positive engagement
and OCBs OCBs (Avey et al., 2008). Together, these resources have cognitive, affective,
motivational and decisional components (Bandura, 1997; Bandura, & Locke, 2003;
Carver & Scheier, 1999; Peterson, 2000) that help them to successful develop and
implement innovative ideas at their workplace.


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Besides, High PsyCap individuals, as the definition suggests, possess the
cognitive capacity of self-regulation (Bandura, 1997) that provides initiative, proactiveness, and self-discipline necessary to reach their goals (Luthans & Youssef, 2007).
Taken together, high PsyCap individuals have a built-in tendency to creatively develop
multiple pathways to accomplish their goals and investing their efforts in generating,
promoting, and realizing job-related innovative behaviors. Building on the above
literature, we hypothesize the following
Hypothesis 1: Psychological capital is positively related to innovative performance
Hypothesis 2: Psychological capital is negatively related to job stress

Sample and Data Collection Procedures
The data was collected through administration of a questionnaire at two banks,
head office of a textile firm, and the regional office of a large public telecommunication
organization in one of the largest cities of Pakistan. As English is a medium of instruction
at college and university levels and people read and understand English, we did not
require to translate the questionnaire in local language.
We used personal and professional contacts to get initial entry permission from
the concerned organizations. The questionnaire also included a cover letter explaining the
purpose of the study to the respondents and assuring them of strictest confidentiality.
The participation was voluntary and respondents completed self-report version of the
questionnaire which included the measures of psychological capital and job stress. The
respondents also reported their gender, age, occupational levels, education, and work


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experience. The supervisor-report version of the questionnaire was completed by the
respective supervisors of each respondent. Both the respondents and their supervisors
separately returned the completed surveys to one of the authors.
We distributed 300 questionnaires, of which, 237 usable paired (self and
supervisor-report) responses were received with a response rate of 79%. The respondents
consisted of 79% male, with an average age of 31 (SD = 8.03) years and an average
tenure of 4.80 (SD = 6.43) years. The sample represented several occupational levels
including 16% entry level (clerical and technical staff) workers, 80% supervisory and
middle managers, and 4% upper middle and top-level managers with education levels
ranging from 14 years of education to graduate degrees such as MBA.
Psychological capital and job stress were measured using self reported responses.
However, to avoid self reporting bias issues, creative performance was measured using
supervisory rated responses.
The responses for psychological capital were taken on 6-point likert-scale with
anchors ranging from 1 = strongly disagree, 2 = Disagree, 3 = Some what disagree 4
= some what agree, 5 = Agree, to 6 = strongly agree. The responses for creative
performance was taken on a 7-point likert-scale with anchors ranging from 1 = Never, 2
= Rarely, 3 = Occasionally, 4 = Sometimes, 5 = Fairly often, 6 = Very often, 7 =
Always. Response for job stress was taken on 5-point scale ranging from 1 = strongly
disagree, 2 = Disagree, 3 = neither disagree/nor agree, 4 = Agree, to 5 = strongly
agree. Higher responses obtained against a variable represent higher level of construct.


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In addition, respondents were also asked to provide their gender, age (in years), and
tenure (in years) on the survey.
Following questionnaires were used for the collection of data.
Psychological Capital. 24-items questionnaire (PCQ: Luthans et al, 2007) was be
used to measure the Psychological Capital. Examples of the items include I feel
confident analyzing a long-term problem to find a solution, If I should find myself
in a jam at work, I could think of many ways to get out of it, When I have a setback
at work, I have trouble recovering from it, moving on, When things are uncertain
for me at work, I usually expect the best. The reliability of Psychological capital
measure was = .83.
Innovative Performance. Innovative performance was measured using 6-items from
the Janssens (2000, 2001) scale for individual innovative behavior in the workplace
that is based on Kanters (1988) work on stages of innovation. Two items on this
questionnaire referred to idea generation, two items to idea promotion, and two items
to idea realization. Sample items include Creates new ideas for improvements,
Generates original solutions to problems and Transforms innovative ideas into
useful applications. The reliability of innovative performance measure was = .89.
Previous research shows that these three dimensions combine additively to create an
overall scale of individual innovative behavior (Janssen, 2001; Janssen, 2004).
Job Stress. We used the shortened version of Job Stress Scale (Parker and DeCotiis,
1983) used by Jamal and Baba (1992) The example items included in the
questionnaire were Sometimes when I think about my job I get a tight feeling in my


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chest and I have too much work and too little time to do it in. The reliability of job
stress measure was = .71.
Control Variables.
We used age and gender as control variables because of their possible
effects on job outcomes (Furnham, & Bachtiar, 2008). A one-way ANOVA comparing
innovative performance and job stress across organizations revealed that significant
differences in job stress (F = 5.42, p < .02) were found for organization type. Further,
post-hoc analyses revealed that the differences were only between the 1 public sector and
3 private sector organizations. Hence, we created a dummy variable (0 = Private, 1 =
Public) to control for the effects of organization type on the analyses reported below.
Finally, we included age, gender, and organization type as controls for all outcomes.
Table 1 shows the means, standard deviations, bivariate correlations, and
estimates of reliability (coefficient alpha). The zero-order bivariate correlations between
psychological capital, job stress, and innovative performance were in the excepted
direction. Psychological capital was negatively related to job stress (r = -.15, p <.05) and
positively related to innovative performance (r = .20, p <.05).
-----------------------------Insert Table 1 about here
-----------------------------Multiple linear regression analysis was used to test all main effect hypotheses.
Age, Gender, and Organizational type were entered in the first step followed by the
independent variables. Table 2 presents the regression results for the effect of
psychological capital on job stress and innovative performance. Results reveal that


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psychological capital was positively related to innovative performance ( = .41, p < .001)
and negatively related to job stress ( = - .14, p < .05). These results render support for
hypotheses 1 and 2.
-----------------------------Insert Table 2 about here
Psychological capital, as a second order psychological resource, has emerged as
an important construct in positive organizational behavior literature. Researchers in
various domains are exploring the value added effects of psychological capital in
predicting desirable outcomes at the workplace. The current study tested for the main
effects of psychological capital on employees innovative performance and job stress.
Our findings clearly support the assertion that individuals, who are high on psychological
capital, are more likely to exhibit creative or innovative behaviors at the workplace, than
their low PsyCap counterparts. Our results reveal that high PsyCap individuals, due to
their natural tendency towards exhibiting innovative behaviors, take initiatives in
generation, promotion, and realization of new ideas at their workplace. Similarly, our
findings also reveal that individuals with high psychological capital reported low job
stress than individuals with low psychological capital. These findings provide an initial
support for the creativity or innovation related characteristics of high PsyCap individuals.
Theoretical Implications
Despite its theoretical appeal and importance in todays workplace, we found no
study that investigates the relationship between psychological capital and innovative job


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performance. The paper provides some extensions to the nascent theory of psychological
capital by exploring its link with employees innovative performance. This initial support
calls upon future research to use additional creativity or innovation related measures to
investigate their relationship with psychological capital.
Practical Implications
This study also has some implications for practicing managers. Since, PsyCap is a
state-like and open to development (Luthans, Avey, & Patera, 2008) managers can help
their employees, through training interventions, to develop their psychological capital. It
will help the employees to foster new and innovative ways of doing completing their
assignments and tasks. High PsyCap individuals, due to their positive psychological
resources, may appear as a competitive advantage to their organizations. In addition,
managers should be careful in assigning relatively stressful tasks to those who are low on
psychological capital as these individuals are more likely to report job stress.
There are several limitations to the current study. Like most of the research, this
study was a cross sectional field survey that limits the causality related inferences made
for the proposed links. Another concern was the possibility of common method/same
source bias since psychological capital and job stress were measured in the same
questionnaire by the same respondent. However, this should not be an issue in case of
innovative performance as it was measured using supervisory-rated responses.
Future Research Directions
Future research should incorporate other related measures to provide a more
comprehensive understanding of the link between positive psychological resources and


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creativity or innovation related criterion variables. Future research can also help by
comparing the predictive ability of psychological capital with other creativity related
personality characteristics to give an insight of the relative strengths of these dispositions.
Finally, longitudinal research designs are very critical to our understanding of the
directions of influence between psychological capital and job outcomes.

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Table 1: Means, Standard Deviations, Correlations, and Reliabilities



1. Gender



2. Age




3. Organization Type





4. Job Stress







5. Innovative Performance








6. Psychological Capital









Note. N = 237; Cronbachs alphas presented in parenthesis; For organizational type 0 = Private; 1 =
Public; Gender was coded as 1 for male and 2 for female
* p < .05
** p < .01


Ref No. 449

Table 2: Regression Results for Psychological Capital, Innovative Performance, and Job

Innovative Performance

Job Stress

Step 1:






Organization Type



. -.24*






Psychological Capital

Note. N = 237; For organization 0 = Private and 1 = Public.

* p < .05
** p < .001