How does income inequality — currently at historically high levels — affect the types of leaders we get in the workplace? As a first step toward exploring that question, we carried out a study exploring how parental income while people are growing up relates to their leadership behaviors as adults. We found that parental income is significantly related to adult levels of narcissism, a trait characterized by grandiose self-views, impulsive tendencies, and low empathy. We also found that those levels of narcissism were associated with people’s engagement (or lack thereof) in important leadership behaviors and various measures of effectiveness.
We studied these dynamics in a sample of actively serving U.S. Army soldiers, all of whom graduated from the United States Military Academy at West Point and are now in leadership roles. This sample allowed us to hold important factors constant, such as level and quality of education, current income,
current position in organizational hierarchy. We collected the leaders’ parental income from materials they submitted as part of their college application to West Point. We then sent them a survey, asking them to indicate their agreement with a series of statements designed to measure their levels of narcissism. These included statements such as “I know that I am special because everyone keeps telling me so” and “Many group activities tend to be dull without me.”
Next, the soldiers were rated by their followers on three broad types of leadership behaviors that are seen as essential to effective leader performance: relational behaviors, such as showing concern and consideration for followers; task behaviors, such as clearly organizing work and group roles; and change-related behaviors, such as encouraging innovative thinking, sharing different perspectives, and communicating a compelling vision. Followers also answered questions assessing different aspects of the leaders’ performance. They rated how effective they perceived their leaders to be and the amount of helping and counterproductive behaviors they saw in group members.
We found that parental income was indirectly related to leaders’ effectiveness. Our analysis showed that higher parental income during one’s upbringing was related to higher levels of narcissism as an adult, and that higher narcissism was related to lower levels of engagement in relational, task, and change-oriented behaviors. Less engagement in these behaviors was associated with lower perceived effectiveness, and with less helping behavior and more counterproductive behavior in the group. In short, higher parental income indirectly impaired leadership performance by fostering narcissism, which in turn reduced engagement in important leadership behaviors.
An interesting question is why leaders from higher-income backgrounds do not appear to be notably better at leading than people from lower-income backgrounds, at least in our study. It seems reasonable to assume that growing up in a higher-income household would afford many advantages that could enhance leadership abilities later in life. For instance, higher-income parents may live in safer neighborhoods with better schools, be able to afford coaches, tutors, and camps to develop children’s skills, and be able to give their children access to beneficial developmental experiences, such as unpaid internships that require financial support from parents, or other résumé builders.
But our findings complement a growing body of work that suggests high income has potential downsides. Higher-income people may live in conditions that foster the (often correct) perception that they are independent. At the same time, this perception can foster the dubious belief that higher-income people are more talented or special than other people, and so do not require others’ assistance, input, or ideas. Related research shows that higher income is related to lower concern and compassion for other people and lower tendencies to help them. Indeed, it seems that children from higher-income families learn these lessons as well: Another study found that young children from higher-income households are less willing than children from lower-income households to donate their stickers to friends and give their own prize tokens to sick children. Behaviors like viewing oneself as independent and unique and prioritizing oneself over others are likely to become narcissistic tendencies that influence how children interact with others.
Why does this matter for businesses? Well, narcissism has a complicated relationship with leadership. It has been linked with being evaluated positively and with the potential to emerge as a leader in groups of people that are not well acquainted. And in brief interactions (like a job interview), narcissists can often leave very positive impressions. But narcissism has also been linked to bad outcomes in the long run, because tendencies to prioritize oneself over others has negative effects on interpersonal relationships and group functioning over time.
Our findings suggest that a high-income background does not always translate into better performance, because while it might afford certain benefits, it can also foster a deep self-preoccupation that can impair leadership abilities. Conversely, and encouragingly, our findings suggest that people from humbler backgrounds often can succeed and perform just as well as people from greater wealth because they may not be prone to the same level of narcissistic tendencies.
It is important to note that this is a first study, and while evidence for the link between income and narcissism is rapidly accumulating, we need more research to explore how this link relates to peoples’ behaviors in organizations and to explore those dynamics in other contexts. Given that everyone in our sample was at essentially the same hierarchical level, this study was not able to explore whether growing up wealthy or poor influences who is promoted to leadership positions in the first place.
But organizations should view these results as cautionary. In order to enable excellent leadership, companies should try to standardize formal practices that can mitigate narcissism, including highlighting and prioritizing compassion and care for others in the workplace and creating a culture that recognizes and rewards service to others. Doing so might allow those who come from higher-income backgrounds to make better use of the advantages that a privileged background affords, and might place greater value on things that those from lower-income backgrounds do well — making the workplace more fulfilling for everyone.