Abstract
Moving away from previous research that focused on the positive effects of employees' trust, this study delves into the outcomes of leaders' trust in their employees. Drawing from resource dependence theory, the research suggests that a leader's trust in employees might inadvertently stifle their own innovative behavior. This happens as increased trust could lead to leader complacency, which in turn might reduce their innovative behavior. The study further explores the limiting factor of information asymmetry, which could exacerbate these effects when employees possess more information about job tasks than their leaders. To validate our theoretical model, two distinct studies were conducted. The first study utilized a vignette experimental design, following established methodological guidelines from the literature. We designed scenarios to reflect varying levels of trust in employees and information asymmetry, assessing their combined effects on leaders' innovative behavior through a 2×2 factorial design. The responses of 215 university students were analyzed using one-way ANOVA to test our hypotheses. The second study employed a survey method targeting supervisory and managerial staff in the hospitality industry. A total of 31 managers and 119 team leaders participated in this study. We used structural equation modeling in Mplus to corroborate the experimental study's findings and further investigate the incremental effects of leaders' trust in employees on their innovative behavior. Both moderation and moderated mediation effects were examined using a model by Hayes (2015). Our findings indicate that leaders' trust in their employees adversely impacts their innovative behavior, mediated by increased leader complacency. However, this adverse effect is lessened by information asymmetry, particularly when leaders possess more information than their employees. These results not only contribute to the theoretical understanding by introducing a new research perspective on the outcomes of leaders' trust in employees—contrasting with the traditional focus on employee trust in leaders—but also offer managerial insights for the hospitality industry. Moreover, this research opens the door for future studies to validate these findings in diverse contexts and extend our understanding of the dynamics between leader trust, information asymmetry, and leader innovative behavior.