At the Helm, Kirk or Spock? The Pros and Cons of Charismatic Leadership∗

Charisma is often seen as a positive leadership attribute, yet many studies give it a “mixed report card,” finding it less valuable than popularly thought. This paper develops a model to explain why. The key insight is that presenting the cold hard truth is often incompatible with simultaneously firing up followers—a tradeoff exists between information and inspiration; a temptation exists to hide bad news behind upbeat rhetoric. Rational followers understand this. But as long as any followers are swayed by such appeals—respond to the leader’s charisma—rational followers’ pessimism is tempered, and more so the more charismatic the leader. Hence, a more charismatic leader can generate better responses from all followers with an emotional appeal than can a less charismatic leader. This is a benefit to charisma. But this power has a dark side: a highly charismatic leader is tempted to substitute charm for action—she is less likely to learn relevant information and, on certain margins, works less hard herself—all to her followers’ detriment.