Abstract
While previous research has explored dispositional and managerial antecedents of ethical leadership in order to promote this positive style of leader behaviors, our knowledge regarding whether broader and extra-organizational context within which supervisors operate may affect the emergence of their ethical leadership remains underspecified. In this research, we draw on uncertainty management theory (UMT) to examine how and when supervisor financial insecurity influences ethical leadership behavior at work. Specifically, we suggest that supervisor financial insecurity triggers supervisor anxiety, which in turn inhibits the demonstration of ethical leadership. We also examine organizational pay fairness as a moderator in this mediation process, such that supervisors who perceive their pay as fair are less susceptible to the anxiety resulting from financial insecurity than those who perceive their pay as unfair. Results from a three wave, multisource field study involving 305 supervisor-subordinate dyads provided support for our hypothesized model. Theoretical and practical implications of our findings are discussed.