What leadership theory posits that leaders develop different quality relationships (in-group vs. out-group) with individual subordinates?

Explanation

• Leader-Member Exchange (LMX) Theory asserts that leaders form unique dyadic relationships with subordinates, dividing teams into In-Group and Out-Group members.
• In-Group members enjoy higher trust, autonomy, responsibility, and rewards; Out-Group members receive formal treatment restricted to contractual duties.
• Higher quality LMX relationships correlate with higher employee job satisfaction and lower turnover intention.