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/> Therefore is chosen only to discuss transformational and transactional leadership in this literature review. In the next paragraph these two styles will be further analyzed.

1.1.1 Transactional leadership
'Transactional leadership occurs when the initiative of one person towards others to make contact for an exchange of something valuable.' (Burns,1978) (Bass, 1985) (Kuhnert and Lewis, 1987)

Bass (1990) made a distinction between four types of transactional leaders.

Contingent reward:

The manager gives rewards if employees perform well by giving pay increases and advancement. But he also gives penalties if they do not perform well.

Management by exception (active):

A transactional leader only takes action when things went wrong. He is constantly looking for deviant behavior and then he takes corrective action. (Bass,1990)

Management by exception (passive):

In this typology the manager intervenes only if the standards are not met.

Laissez-Faire:

Some researches argued that this is a separate leadership style (Eagly and Johannesen-Schmidt, 2001), but Bass (1990) argued that this is a part of transactional leadership. A Laissez-Faire manager constantly avoids decision making, he takes no responsibility.

Bass (1990) find this kind of leadership ineffective and, in the long run, counterproductive. Also he found out that the effectiveness of this style depends on the control that the leader has on the rewards or penalties.

1.1.2 Transformational leadership
Transformational leaders are charismatic leaders, that is why they inspire their employees. Employees wants to identify with this leaders. They give each employee personal attention and treat them individually. He intellectually stimulates his followers and gives advice and coaches them individually. He gains respect and trust. He tries to solve each problem carefully (Bass, 1990). This is a general description of a transformational leader.

In a more recent attempt to define a transformational leader, Avolio, B.J., Bass, B.M., Jung, D.I. and Berson, Y. (2003) made a distinction between four different types of transformational leaders:

Idealized influence:

'These leaders are admired, respected and trusted. Followers identify with and want to emulate their leaders. Among the things the leader does to earn credit with followers is to consider followers' needs over his or her own needs. The leader shares risks with followers and is consistent in conduct with underlying ethics, principles and values'. (Avolio et al., 2003)

Inspirational motivation:

'Leaders behave in ways that motivate those around them by providing meaning and challenge to their followers' work. Individual and team spirit is aroused. Enthusiasm and optimism are displayed. The leader encourages followers to envision attractive future states, which they can ultimately envision for themselves'. (Avolio et al., 2003)

Intellectual stimulation:

'Leaders stimulate their followers' effort to be innovative and creative by questioning assumptions, reframing problems and approaching old situations in new ways. There is no ridicule or public criticism of individual members' mistakes. New ideas and creative solutions to problems are solicited