Abstract
Leader-member exchange (LMX) differentiation, or a leader's differentiated treatments among team members, is a prevalent phenomenon in any type of organization due to constraints of personal, social, and organizational resources. Despite numerous empirical examinations of such phenomenon, the impact of LMX differentiation on group outcomes is inconsistent and inconclusive. Based on team diversity framework, we approach LMX differentiation as disparity and draw on social comparison theory and social exchange theory to examine the positive effect of LMX differentiation on team counterproductive work behavior (CWB) through a supervisory justice climate. In addition, we investigate leader competence as an essential boundary condition that influences the impact of LMX differentiation on supervisory justice climate and subsequent team CWB. Using a sample of 94 teams in South Korea, we found that LMX differentiation negatively impacts supervisory justice climate, subsequently promoting team CWB. Furthermore, when team members perceive their leader as incompetent, the positive impact of LMX differentiation on team CWB is strengthened. Theoretical and practical implications and directions for future research are discussed.