The Effects of Induced Emotions on Leading‐By‐Example

ABSTRACT This paper investigates the effects of induced emotions on leading‐by‐example. Using an online sample of more than 1000 participants, we observe behaviour in a one‐shot sequential voluntary contribution mechanism game where leaders and followers are induced to be either happy or angry. Our findings show that angry leaders contribute less than happy leaders. The same effect is observed when considering followers' behaviour. A follow‐up study using the strategy method, where followers make conditional contribution decisions without observing the leader's actual contribution, detects no statistically significant differences between angry and happy followers' conditional contribution schedules. This suggests that the effect of induced emotions on followers' behaviour operates primarily through the leader's behaviour, highlighting the importance of leader emotions in shaping team outcomes. More broadly, our findings highlight the role of emotions as a causal force, suggesting that negative changes in well‐being can bring about adverse effects on team cooperation.