Journal of Managerial Psychology

Psychological capital and job satisfaction in Egypt

Mohga A Badran Carolyn M. Youssef-Morgan
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JMP
30,3
Psychological capital and job
satisfaction in Egypt
Mohga A. Badran
354 Management Department, American University in Cairo, Cairo, Egypt, and
Carolyn M. Youssef-Morgan
Received 15 June 2013 College of Business, Bellevue University, Bellevue, Nebraska, USA
Revised 12 December 2013
29 March 2014
Accepted 30 March 2014 Abstract
Purpose – The purpose of this paper is to extend the boundaries of positive organizational behavior
(Luthans, 2002a, b) to North Africa and the Middle East. Specifically, the relevance of Psychological
Capital (PsyCap et al., 2007), composed of the positive psychological resources of hope, efficacy,
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resilience and optimism, is conceptualized and tested in Egypt in relation to job satisfaction.
Design/methodology/approach – A contextualized theoretical model is derived, in which PsyCap
can lead to job satisfaction through a set of positive mechanisms. Structural equation modeling is used
to test the hypothesized relationships on a sample of 451 Egyptian employees in 11 organizations
representing some of Egypt’s most important industries in terms of GDP, employment and world
economy integration.
Findings – Hope, efficacy, resilience and optimism, individually and when integrated into the
higher-order multidimensional construct, PsyCap, are positively related to the job satisfaction of
Egyptian employees.
Research limitations/implications – This paper supports the external validity of hope, efficacy,
resilience and optimism, individually and when integrated into the higher-order multidimensional
construct, PsyCap, in the African and Egyptian context.
Practical implications – Egyptian organizations, as well as global companies that conduct
business operations in Africa, may find PsyCap to be a new potential source of human-based
competitive advantage. PsyCap is state-like and thus open to development through workplace
interventions.
Originality/value – This study provides evidence for the first time for the external and construct
validity of PsyCap in North Africa. Zoogah (2008) found a dearth of articles that focus on North Africa,
specifically the Arabian heritage. This paper begins to fill this gap. A context-bound approach is
used to refine and integrate PsyCap theory with the cognitive, affective and behavioral processes of the
African and Egyptian context.
Keywords Resilience, Psychological capital, Self-efficacy, Optimism, Hope,
Positive organizational behaviour
Paper type Research paper

Introduction
This paper extends the boundaries of positive organizational behavior (POB; Luthans,
2002a, b) to North Africa. Specifically, the relevance of Psychological Capital (PsyCap;
Luthans et al., 2007), composed of the positive psychological resources of hope, efficacy,
resilience and optimism, is conceptualized and tested in Egypt. A theoretical model is
derived, in which PsyCap can lead to job satisfaction through a set of highly desirable
positive mechanisms in an environment that is perceived by many to be plagued
by apathy and despair. The model is then tested using a sample of 451 Egyptian
Journal of Managerial Psychology employees in 11 organizations representing some of Egypt’s most important industries
Vol. 30 No. 3, 2015
pp. 354-370
in terms of GDP, employment and world economy integration. In his review, Zoogah
© Emerald Group Publishing Limited (2008) found a dearth of articles that focus on North Africa, specifically the Arabian
0268-3946
DOI 10.1108/JMP-06-2013-0176 heritage. This paper begins to fill this gap.
 POB and PsyCap Job
Grounded in positive psychology (Seligman and Csikszentmihalyi, 2000), POB is defined satisfaction
as “the study and application of positively oriented human resource strengths and
psychological capacities that can be measured, developed, and effectively managed
in Egypt
for performance improvement” (Luthans, 2002b, p. 59). Positive psychology calls for a
more balanced approach that addresses human strengths and weaknesses. POB offers
a scientific, integrative framework that can help measure, explain and develop positivity 355
in the workplace, even amidst today’s predominant uncertainty and negativity.
Four psychological resources have been identified as best fitting these inclusion criteria
of being positive, theory-based, measurable, developmental and performance related.
These positive psychological resources are: hope, efficacy, resilience and optimism.
Hope is “a positive motivational state that is based on an interactively derived sense
of successful (1) agency (goal-directed energy) and (2) pathways (planning to meet
goals)” (Snyder et al., 1991, p. 287). Agency represents the willpower and determination
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to achieve goals, while pathways represent the “waypower” or ability to generate

alternative ways to overcome obstacles (Lopez, 2013).
Efficacy, or confidence, is “one’s belief about his or her ability to mobilize the
motivation, cognitive resources, and courses of action necessary to execute a specific
action within a given context” (Stajkovic and Luthans, 1998b, p. 66). Grounded in social
cognitive theory, efficacy motivates the selection of challenging goals, and mobilizes
the cognitive mechanisms of symbolizing, forethought, observation, self-regulation
and self-reflection toward goal pursuit (Bandura, 1997, 2012).
Resilience is “the developable capacity to rebound or bounce back from adversity,
conflict, and failure, or even positive events, progress, and increased responsibility”
(Luthans, 2002a, p. 702). While the importance of resilience is recognized for “at-risk”
populations (Masten et al., 2009), interest in and applications to organizational settings
is growing (Hamel and Välikangas, 2003). Resilience can help organizations and their
members survive, overcome, learn from and grow through challenges (Youssef and
Luthans, 2005).
Optimism is a generalized positive expectancy (Carver et al., 2009) and a positive
explanatory style of attributing positive events to personal, permanent and pervasive
causes and negative events to external, temporary and situational ones (Seligman,
1998). Optimism is particularly relevant for maintaining a positive outlook in a
predominantly negative environment through buffering the impact of negative events
while boosting the impact of positive events.
PsyCap combines the four positive psychological resources as defined above into
a multidimensional, higher-order construct (Luthans and Youssef, 2004; Luthans
et al., 2007). The shared underlying mechanism among PsyCap’s four constituent
psychological resources is “one’s positive appraisal of circumstances and probability
for success based on motivated effort and perseverance” (Luthans et al., 2007, p. 550).
Empirically, PsyCap has been found to be a valid and measurably reliable higher order,
multidimensional construct (Luthans et al., 2007).
There is ample support for the relationship between each of PsyCap’s components
and desirable work outcomes (see e.g. Stajkovic and Luthans, 1998a; Youssef and
Luthans, 2007). However, PsyCap has been demonstrated to go beyond and add value
to the contribution of each of its four constituent resources to performance and
attitudinal outcomes in the workplace (Luthans et al., 2007). Recent meta-analytical
results support positive relationships between PsyCap and desirable employee attitudes
such as job satisfaction, organizational commitment and psychological well-being;
 JMP employee behaviors such as citizenship; and multiple measures of performance
30,3 (self-evaluations, supervisor-evaluations and objective performance measures).
Negative relationships were also supported between PsyCap and undesirable
employee attitudes such as cynicism, turnover intentions, job stress and anxiety; as
well as counterproductive work behaviors (Avey et al., 2011). Beyond cross-sectional
support, recent experimental and longitudinal studies also demonstrate causal
356 evidence, and support PsyCap’s state-like openness to development over time and
through focussed workplace interventions (e.g. Avey et al., 2010a; Luthans et al., 2010;
Peterson et al., 2011).

PsyCap around the world

PsyCap started to gain interest and attention outside the USA. Several researchers
attempted to investigate the global and cross-cultural applications of PsyCap, both
conceptually (Youssef-Morgan and Luthans, 2013), and empirically (Vogelgesang
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et al., 2014). In Australia, Avey et al. (2010b) found that PsyCap was related to the level
of the employees’ financial and manager rated performance. Similarly, in Iran, Mehrabi
et al. (2013) found a significant positive relationship between the PsyCap and meaning
at work. In Hungary, Lehoczky (2013) found that new business graduates’ PsyCap was
significantly related to success in finding a job, earning a good salary and career
satisfaction across demographic groups. In South Africa, cross-cultural PsyCap
training has been found to enhance cultural intelligence and reduce ethnocentrism
(Reichard et al., 2014).
In an exploratory study of Chinese workers, Luthans et al. (2005) found a significant
relationship between PsyCap and performance as rated by the supervisor and relative
merit-based salary. The results of a follow up study in both state owned and private
enterprises by Luthans et al. (2008) also revealed a relationship between PsyCap and
employee performance. Huimei and Xuan (2011) also found that the PsyCap of Chinese
workers was positively related to organizational identity. In New Zealand, Roche
et al. (2014) found PsyCap to mediate the relationship between mindfulness and mental
well-being in managers and entrepreneurs. PsyCap did not receive as much support
in India (Shahnawaz and Jafri, 2009).

The Egyptian context

Egypt is located in the north-eastern corner of Africa. This strategic geographic location
at the intersection of the Mediterranean and Red Seas (connected by the Suez Canal),
is central to shipping freight operations, estimated to account for 90 percent of world
trade. The area of Egypt is about one million square kilometers (390,000 square miles).
Only a small percentage of the land, around 5 percent, is inhabited. This is the area along
the banks of River Nile.
Culturally, Egypt represents an intersection of many cultures. Similar to many
North African countries, Egypt has been ruled by the Persians, Greeks, Roman, Turks,
Arabs, French and British for centuries, before the 1952 revolution. These ruling
regimes have left their fingerprints in terms of physical infrastructure, secular
governance, formal education systems, modern medicine, multilingual proficiency, and
exposure to a wide range of cultures and contemporary management practices.
Over the last two years, a series of organized political revolutions swept North Africa
including Egypt. Some of these ambitious, youth-led movements succeeded in
removing oppressive political regimes that had ruled these countries for decades,
 which initially provided much hope and optimism to Egyptians, and an inspiration to Job
the world at large. satisfaction
North African and Middle Eastern cultures, including Egypt, tend to be collectivistic
and high in power distance (Hofstede, 2001). In terms of the more recent findings of the
in Egypt
Global Leadership and Organizational Behavior Effectiveness (GLOBE) research
program ( Javidan et al., 2006), Egypt tends to be high on in-group collectivism (family
and work team pride, loyalty and cohesiveness), power distance, humane orientation, 357
and male domination. Like many Middle Eastern cultures, it has medium levels
of performance orientation and assertiveness, and low levels of future orientation.
In other words, welfare and social harmony of the group or family takes priority over
performance and individual achievements.
Egyptians practiced agriculture for almost 7,000 years, which promoted collectivism
but may have also nurtured an autocratic and paternalistic leadership style (Beekun
et al., 2008). The flow of the water of the Nile and the regularity of the yearly flood
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created a predictable routine.

Religion is a primary source of cultural heritage for the Egypt and permeates daily
life, including work (Parnell and Hatem, 1999). Muslims constitute around 90 percent
and Christians around 10 percent of the population. Strong and shared religious
beliefs such as honesty, charity and divine providence provide a source of hope, but
when taken to an extreme, they can also enforce fatalism, passivity and unquestioning
acceptance of life’s setbacks and uncertainties.
Rice (2006) investigated the work values that affect Employee Creative Behavior
(ECB) in Egypt. Self-direction, stimulation and achievement were positively related to
ECB, while conformity and power were negatively related to ECB. Responsibility
to share experience, encouragement to take risk and a structured environment also
predicted ECB. Badran (2006) investigated six Egyptian work values, which ranked in
order of importance as follows: pride in work, job involvement, activity preference,
attitude toward earnings, social status of the job and upward striving. Thus, intrinsic
values were more significant than extrinsic ones.

The relevance of PsyCap for North Africa and Egypt

There is evidence that intentional positivity plays an important role in sustaining the
North African economy. For example, consistent growth of the informal economy
reflects hopeful determination and pathways thinking by employers to achieve optimal
allocations of human capital, and employees seeking better lives. The prioritization of
intrinsic over extrinsic work values in Egypt (Badran, 2006), where 20-30 percent of the
population lives below the poverty line according to the United Nations, is surprising
and reflective of agentic, self-motivated goals and choices and high efficacy. The recent
political movements are highly indicative of hope, confidence, optimism and resilience
amidst dire circumstances and extreme risks (Youssef, 2011).
PsyCap can be an invaluable resource for Egyptian and North African employers
and employees. First, PsyCap’s positive appraisals and success expectancies can help
sustain the motivation, effort and perseverance necessary for pursuing the challenging
goals facing North Africa in almost every life domain. Positive appraisals can also
buffer the common human negativity bias (Baumeister et al., 2001), which is likely
exacerbated by the mounting challenges and setbacks facing North African employers
and employees. PsyCap has also been shown to relate to attitudes and behaviors that
can be instrumental in facilitating positive change (Avey et al., 2008), which many
organizations in this region are currently undergoing.
 JMP Second, each of PsyCap’s constituent resources is highly relevant for the
30,3 North African and Egyptian workforce. Hope agency can help combat indecision,
procrastination and indifference (Tuma, 1988), which continue to prevail among
Egyptians, even in the post-revolution era. Hope pathways can enhance creativity,
innovation and motivation to find productive ways to overcome obstacles, and maybe
mitigate the prevalent “brain drain” facing Egypt and many North African countries
358 (Youssef and Luthans, 2006). Efficacy can give North African employees the confidence
that they can successfully take charge of their own career development (Nilsson
et al., 2002), build more relevant skill sets, and pursue much-needed educational and
training opportunities. Resilience can help them overcome the frequently encountered
setbacks and view them as opportunities for learning and growth (Tedeschi et al., 1998).
Optimism can help them maintain a positive outlook, take credit for their notable
accomplishments to-date, and utilize more benign and less self-destructive
explanations of uncontrollable events, buffering the harmful psychological, social
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and even physical effects of adversity.

Third, as a state-like PsyCap with growth and development potential (Luthans
et al., 2010), PsyCap can provide employers with the means to develop their existing
employees’ agentic desire to succeed and motivation to invest the effort and
perseverance necessary to achieve personal, career and organizational goals (Luthans
et al., 2007). This evidence-based, positive, developmental approach is likely to resonate
with employers who may feel “stuck” with unmotivated employees that they cannot
fire without incurring significant hardships.

PsyCap and job satisfaction

PsyCap’s contribution to job satisfaction can be particularly relevant for developing a
better understanding of the role of positivity in the North African business environment.
Two reasons are proposed for the importance of this linkage. First, for many years now,
it is recognized that job satisfaction emphasizes the intrinsically motivating components
of the job (Herzberg et al., 1959). On the other hand, other attitudinal (e.g. organizational
commitment; Meyer et al., 2002) and behavioral (e.g. organizational citizenship; Todd and
Kent, 2006) outcomes are likely to be influenced by the myriad of contextual factors
currently at play in the North African business environment. Since this is the first study
applying PsyCap in Egypt, it seems more appropriate to investigate PsyCap’s more
proximal outcomes before introducing other outcomes that are likely to be moderated
by those contextual factors. Second, job satisfaction has one of the strongest established
relationships with job performance ( Judge et al., 2001). Given the limited availability
and use of objective performance metrics by most North African organizations,
job satisfaction can provide an adequate alternative outcome measure (Dess and
Robinson, 1984).
PsyCap can enhance the job satisfaction of Egyptian employees through several
mechanisms. First, job satisfaction entails positive overall appraisals of the job,
satisfaction with the tasks involved and feelings of accomplishment from doing that job
( Judge et al., 2001). PsyCap can enhance employees’ positive appraisals of their
circumstances and increase their perceived probability of success based on their agency,
motivation, effort and perseverance (Luthans et al., 2007). It follows that PsyCap can
significantly contribute to the job satisfaction of Egyptian employees through enhancing
their appraisals of their jobs, responsibilities and achievements. In contrast, low PsyCap
would lead to negative appraisals and expectancies, diminished intrinsic motivation and
consequently an emphasis on extrinsic rewards such as pay, working conditions and job
 security, all of which have been heavily regulated and are currently being compromised Job
by the post-revolution transient economy. While important to prevent job dissatisfaction, satisfaction
it is established that these hygiene factors are unlikely to yield higher levels of
satisfaction with job content and characteristics (Hackman and Oldham, 1980; Herzberg
in Egypt
et al., 1959). Thus, the following can be hypothesized:
H1. PsyCap as a higher-order construct, manifested as hope, efficacy, resilience and
optimism, is positively related to job satisfaction. 359
In addition, each of PsyCap’s constituent resources can enhance job satisfaction
through additional mechanisms. Efficacy can motivate the effort and perseverance
necessary to choose, pursue and achieve challenging goals (Bandura, 1997). Achieving
challenging goals can lead to satisfaction (Locke and Latham, 2002). Efficacious
Egyptian employees are more likely to view their difficult work situations as challenges
to be proactively pursued rather than problems to be avoided. Approach goals
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have been found to be more effective in enhancing satisfaction than avoidance goals
(Carver and Scheier, 1999; Elliot and Sheldon, 1997; Elliot et al., 1997). Thus, efficacy
can enhance the job satisfaction of Egyptian employees as they agentically tackle
work-related challenges.
Hope agency and pathways can interactively provide Egyptian employees with
a sense of control as they address the many conflicting and uncertain demands of
their work situations, which can increase satisfaction. They can also protect them from
feelings of inadequacy and frustrated goal pursuit in an environment where goal
frustration is all too common, which can lead to more positive appraisals and
satisfaction (Kim-Prieto et al., 2005). Resilient processing of setbacks can help build the
coping mechanisms necessary for enlisting the right material, cognitive, affective and
social resources to overcome challenges and continue to meet goals (Masten, 2001;
Masten et al., 2009), which can yield feelings of accomplishment that result in job
satisfaction. An optimistic explanatory style can help create a sustainable system
of positive appraisals of various job dimensions, interactions, successes and
accomplishments, leading to higher overall levels job satisfaction. Thus, the following
can be hypothesized:
H2. Hope, efficacy, resilience and optimism are positively related to job satisfaction.
Finally, in line with the empirical support to-date for PsyCap as a higher-order
multidimensional construct that goes beyond each of its constituent positive
psychological resources (Luthans et al., 2007), and to extend the construct validity of
PsyCap in the Egyptian business environment, the following hypothesis is offered:
H3. PsyCap has a stronger relationship to the job satisfaction than each of its
individual facets of hope, efficacy, resilience and optimism.

Methods
Sample and procedures
Survey data were collected from 451 full-time employees in 11 organizations in Egypt.
These organizations included a pharmaceutical company, two petroleum companies,
a chocolate factory, a food processing facility, an auto assembly plant, a corporate
leasing company, a telecommunication provider, an information technology company,
a public university and a private university, all of which are successful, considered
leaders in their respective fields, and engaged in international activities. In addition,
 JMP they represent some of the most important industries in terms of GDP, employment and
30,3 integration within the world economy for Egypt. With the exception of the public
university (48 participants), all others are private sector organizations. At least
5 percent of the professional employees in each company were represented in the
sample. The number of participants from each organization varied from 24 to 68,
depending on the number of professional employees in the organization.
360 Participants were all university graduates. Successful organizations in Egypt that
are engaged in international collaboration generally require a professional employee
to have good command of the English language. Because English is the most
commonly used business language in Egypt, and often used in professional training,
it was deemed more appropriate to administer the questionnaire in English, and no
translation was necessary.

Measures
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PsyCap can be measured using the valid and reliable Psychological Capital
Questionnaire (PCQ; Luthans et al., 2007) which has been extensively used in recent
PsyCap research (Avey et al., 2011). However, this measure has been adapted from
several established measures of each of PsyCap’s constituent resources (Luthans
et al., 2007). Since this study hypothesizes relationships between each of those positive
resources and job satisfaction, it was deemed more appropriate to use full measures of
those constructs. Moreover, since this study is the first application of PsyCap to the
North African business environment, a secondary goal was to extend the construct
validity of PsyCap to this new context, by replicating some of the original work
in developing the PCQ (Luthans et al., 2007).
Hope was measured using Snyder’s six-item, eight-point State Hope Scale (Snyder
et al., 1996). Efficacy was measured using Parker’s (1998) ten-item, five-point Role
Breadth Self-Efficacy Scale. Resilience was measured using Block and Kremen’s (1996)
14-item, four-point Ego-Resiliency Scale (ER89). Optimism was measured using Scheier
and Carver’s 12-item, five-point Life Orientation Test, as modified by Shifren and
Hooker (1995) to reflect the state-like nature of optimism. Cronbach’s α for these scales
were 0.82, 0.82, 0.69 and 0.46, respectively. The last two were lower than generally
acceptable standards (Kline, 1998). Thus, further analysis was conducted (described
below).
Job satisfaction was measured using a three-item, seven-point scale, adapted from
Hackman and Oldham’s (1980) measure, This approach is consistent with the measures
generally utilized in the extensive research on job satisfaction (Judge et al., 2001).
Cronbach α for this scale was 0.78.

Results
Preliminary and confirmatory factor analysis (CFA)
Means, standard deviations and correlations of the study variables are shown in
Table I. As shown, all the variables were significantly positively correlated ( p o 0.001)
providing initial support for the hypothesized relationships. Most of the first-order
correlations were below 0.6, which supports the discriminant validity and unique
contribution of each variable (Kline, 1998). None of the skewness or kurtosis statistics
exceeded ±2.
Before testing the hypothesized relationships, a CFA was conducted on the study
variables. Hu and Bentler (1995) suggest cutoffs below 0.08 for SRMR, 0.06 for RMSEA
 and above 0.95 for CFI and use a combinatorial rule that two of three indices should be Job
within acceptable ranges for adequate model fit. Hair et al. (2010) consider χ2/df satisfaction
between 2 and 5 adequate, and suggest cutoffs below 0.1 for RMSEA, and above 0.9 for
CFI. Results indicated the following estimates of model fit: SRMR ¼ 0.061,
in Egypt
RMSEA ¼ 0.055, CFI ¼ 0.91, χ2/df ¼ 2.233. The model fit was considered adequate.
All the factor loadings was significant on their respective latent factors at p o 0.05,
and most were significant at p o 0.001. Thus, all the items were retained (despite the 361
low Cronbach α for optimism) to preserve the integrity of the measures as validated in
previous research.
In addition, since PsyCap and its constituent psychological resources are new to the
North African business acumen, it was deemed beneficial to further test the construct
validity of PsyCap in this new context. Three CFAs were conducted. In the first
analysis, the items of each scale were fitted to their latent constructs, which was then
fitted to the higher-order construct, PsyCap. In the second, the items of each scale were
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just fitted to their latent construct. In the third, all the items were fitted on one latent
construct. Results indicated the following estimates of model fit: SRMR ¼ 0.061, 0.069
and 0.072; RMSEA ¼ 0.056, 0.056 and 0.079; and CFI ¼ 0.091, 0.091 0.072, for the first,
second and third analysis, respectively. The superior fit of the first model supports
PsyCap as a higher-order construct, and extends its validity to the Egyptian culture.
Furthermore, since the data on all of the study variables were collected using the
same survey, single source bias is a common threat. One of the ways to statistically
assess the extent of this threat is to conduct CFA, allowing all the items to load on one
latent factor. Adequate fit would indicate single source bias. Results indicated the
following estimates of model fit: SRMR ¼ 0.074, RMSEA ¼ 0.083 and CFI ¼ 0.83. This
model fit was considered borderline inadequate, indicating that single source bias may
be present but is less likely to have influenced the results.

Hypotheses testing results

A series of six structural equation models (SEM) was used to test the hypothesized
relationships. In the first four models, each of the psychological resources of self-efficacy,
hope, optimism and resilience was used independently to predict job satisfaction. In the
fifth model, the four psychological resources were entered concurrently. In the last model,
the four psychological resources were fitted to the latent construct, PsyCap, which was
then used to predict job satisfaction. To preserve degrees of freedom, and based on earlier
CFA results supporting the study measures, the aggregated scales for each of four
psychological resources were used in last two models. Results are presented in Table II.
As shown, the first four models fully supported H2, as self-efficacy, hope, optimism
and resilience independently predicted job satisfaction. Variance explained ranged
from 16 to 29 percent, and was highly significant ( po0.001), and the model fit statistics

Variable Means SD 1 2 3 4 5
1. Hope 5.97 1.06 1
2. Efficacy 3.80 0.72 0.503*** 1 Table I.
3. Optimism 2.96 0.40 0.462*** 0.358*** 1 Means, standard
4. Resilience 3.39 0.47 0.346*** 0.245*** 0.168*** 1 deviations and inter-
5. Job satisfaction 4.88 1.19 0.377*** 0.336*** 0.230*** 0.260*** 1 correlations between
Note: ***p o0.001 study variables
 JMP Model RMSEA CFI SRMR β R2 χ2 df
30,3
1. Efficacy 0.086 0.93 0.058 0.40*** 0.16*** 273.30*** 64
2. Hope 0.058 0.98 0.039 0.47*** 0.22*** 58.96*** 26
3. Optimism 0.093 0.80 0.077 0.54*** 0.29*** 206.10*** 43
4. Resilience 0.059 0.89 0.06 0.34*** 0.12*** 303.98*** 118
5. Model 0.038 1.00 0.019 0.23*** 13.51(ns) 8
362 Efficacy 0.17***
Hope 0.25***
Optimism 0.16***
Resilience 0.05 (ns)
6. Model 0.039 0.99 0.032 0.53*** 0.28*** 22.04 (ns) 13
Table II. Efficacy 0.41***
Structural equation Hope 0.63***
modeling of Optimism 0.55***
hypothesized Resilience 0.81***
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relationships Note: ***p o0.001

were generally adequate. The fifth model further supported H2 with respect to
self-efficacy, hope and optimism, but not resilience. Thus, H2 was partially supported
by this model. The last model fully supported H1 and H2, since all four psychological
resources were significant predictors of the higher-order PsyCap ( p o 0.001), which
in turn was a significant predictor of job satisfaction (R2 ¼ 0.28, p o 0.005). The last
model also explained more variance than three of the first four models, supporting H3
with respect to self-efficacy, hope and resilience, but not optimism. However, the fit
statistics for that model were superior to the third model, including only optimism.
Finally, while the last two models’ fit statistics were not statistically different, the last
model explained more variance, providing further support for PsyCap as a higher-order
construct.

Post hoc analyses

Recent meta-analytical findings showed that the relationship between PsyCap and
employee outcomes were stronger in the service sector (Avey et al., 2011). Contrary
to these meta-analytical findings, post hoc analysis of moderators in the current study
did not support moderation by industry sector. However, there was a significant main
effect of industry sector on job satisfaction such that job satisfaction was actually
stronger in the manufacturing sector ( β ¼ 0.162, ΔR2 ¼ 0.025, p o 0.001).

Discussion
This paper extends the boundaries of POB (Luthans, 2002a, b), and specifically the
multidimensional construct of PsyCap (Luthans et al., 2007). The relationship of
PsyCap and its constituent positive psychological resources of hope, efficacy, resilience
and optimism with job satisfaction is conceptualized and tested in Egypt, a North
African country. Conceptually, PsyCap can lead to job satisfaction through positive
mechanisms such as agentic thinking, positive appraisals and expectancies, motivation
and drive toward goal pursuit, and resilient processing of obstacles and setbacks.
These mechanisms are highly relevant for the North African business environment,
thought by many to be at the low end of global competitiveness, especially in light of
the recent political turmoil.
 Despite these challenges, the data reveals that hope is relatively high (mean ¼ 5.97 Job
on an eight-point scale, SD ¼ 1.06). This is a promising finding for human resource satisfaction
management in Egyptian organizations since hope is an intrinsic, motivational force
that can be developed in organizational settings (Luthans et al., 2008a, b, 2010).
in Egypt
Since hope constitutes goal-directed energy and pathways to achieve goals, Egyptian
managers should strive to engage employees in goal setting, pursuing new horizons
and participating in identifying the means to reach important goals. 363
Self-efficacy is also above the middle point (mean ¼ 3.8 on a five-point scale,
SD ¼ 0.72). However, there is room for improvement in more than one way.
Organizations can greatly improve self-efficacy by providing training. Most training
in Egypt tends to focus on technical issues. Organizations need to put more emphasis
on the soft skills also, especially self-efficacy development, due to its recognized
performance and attitudinal effects. It is worth noting that training has not been
receiving sufficient attention in many organizations in Egypt due to the economic
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conditions that most are facing. However, the current times and challenging conditions
seem to be optimal for efficacy training. Generally Egyptians avoid uncertainty and are
risk averse. They try to set goals where the level of certainty is high. This does not aid
organizations in reaching new markets and introducing new products. Therefore,
improving the level of self-efficacy can enhance performance and competitiveness by
gradually introducing and encouraging the pursuit of more challenging goals.
As revealed in cross-cultural studies (Hofstede, 2001; Javidan et al., 2006), power
distance is high in Egypt and North Africa. Centralization tends to prevail. Enhancing
self-efficacy can facilitate decentralization and empowerment, and encourage
participation and sharing of ideas at all levels.
Resilience has helped Egyptians to cope with occupation, imperialism, undemocratic
regimes, turmoil and other forms of economic, social and political oppression (Youssef,
2011). It should be noted that turmoil in Egypt has not been only after the January 25,
2011 revolution. This study shows high levels of resiliency (mean ¼ 3.39 on a four-point
scale, SD ¼ 0.47). Organizations should capitalize on this high resilience by building
positive cultures, reframing mistakes as opportunities for learning and growth,
exchanging information and knowledge, better internal communication systems, and
instilling continuous learning as an organizational value.
The data revealed that optimism is at a lower level than the other three
psychological resources (mean ¼ 2.96 on a five-point scale, SD ¼ 0.40). This could be
due to the fact that optimism constitutes generalized positive expectancies about
a future that the employee does not have control over. Until very recently, the majority
of Egyptians tended to distance themselves from the political scene, accept their
unfavorable situations as given, and continue with their day to day lives. As such,
organizations in Egypt may not be able to have a strong impact on employees’ positive
expectancies since they may be influenced by political and economic factors. However,
an optimistic explanatory style can be taught (Seligman, 1998), which may facilitate
higher levels of positivity and encourage Egyptians to take charge of their futures
despite what may seem to be insurmountable challenges.
The results concerning optimism warrant additional attention, for several reasons.
First, the lower Cronbach’s α for optimism has been a common problem in positive
psychological research. One of the possible causes of this problem is that Scheier and
Carver’s Life Orientation Test includes negatively worded (reverse-scored) items.
Research has exposed the problematic nature of using negatively worded items
in measuring positive constructs in general, and particularly in measuring optimism,
 JMP because optimism and pessimism are unique constructs, rather than opposite ends
30,3 of the same continuum (Kubzansky et al., 2004). For this reason, updated versions of the
PCQ now include only positively worded items (e.g. Luthans et al., 2013).
A second potential explanation is that the construct of optimism may have been
interpreted differently in the Egyptian context. Previous cross-cultural studies of
PsyCap have encountered similar problems with optimism, which may indicate
364 a problematic understanding of the construct (Lehoczky, 2013; Mehrabi et al., 2013).
A third and related explanation might be lack of measurement instrument invariance
across cultures. For example, in a study of 12 national cultures, Wernsing (2014) found
stronger metric equivalence for a three-factor structure of PsyCap where optimism is
excluded. A potential interpretation for this finding is that given the reflective nature
of PsyCap and thus its emphasis on commonality among its four constituent resources,
the variance explained by optimism may have been redundant with the other three
resources. This does not undermine the importance of optimism, but promotes caution
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in future cross-cultural research in interpreting the results for the optimism

subcomponent of PsyCap.
Structural equation modeling was used to test the hypothesized relationships of hope,
self-efficacy, resilience and optimism, individually and combined into PsyCap, with job
satisfaction, on a sample of 451 Egyptian employees in 11 organizations representing
some of the most important industries in terms of GDP, employment and world economy
integration. The results supported the study hypotheses that hope, efficacy, resilience
and optimism, individually and when integrated into the higher-order multidimensional
construct, PsyCap, were positively related the job satisfaction of Egyptian employees.
This study also provided evidence for the first time for the external and construct
validity of PsyCap in North Africa.
Job satisfaction is one of the strongest attitudinal predictors of job performance
( Judge et al., 2001). In regions where objective performance measures are lacking, such
as North Africa, job satisfaction can provide useful insights (Dess and Robinson, 1984).
A significant relationship between PsyCap, which is state-like and thus open to
development and management in the workplace, and job satisfaction, provides a new
avenue for enhancing job satisfaction, and ultimately job performance, namely PsyCap
development. Although the negative political events and the general economic situation
in Egypt and many other North African countries would suggest despair, apparently
there is significant room for positivity, with direct implications on job satisfaction, and
consequently higher performance.
This study can have several implications for research and practice. Conceptually,
positivity and its underlying assumptions have been critiqued as culturally based and
thus not necessarily as relevant to non-western societies (Lopez and Snyder, 2009).
However, recent empirical findings show that these cultural differences may be smaller
than anticipated (Diener and Biswas-Diener, 2008). This study supports the relevance
of PsyCap in Egypt. Many North African and Middle Eastern countries have
collectivistic, high power distance, uncertainty-avoidant, masculine, diffuse, emotional,
ascription cultures (Hofstede, 2001; Javidan et al., 2006). The validity of PsyCap and its
relationship to job satisfaction in Egypt, supported by this study, provides beginning
evidence for PsyCap’s generalizability to North African cultures, even though on the
opposite end of the cultural spectrum to most of the Western world. More research
needs to be carried out in Egypt and other Arab countries to explore the relationship of
PsyCap with commitment, well-being and performance. Moreover, research could also
be directed to investigate the role of organizational culture and authentic leadership in
 facilitating PsyCap development. Another important area for researchers to investigate Job
is whether PsyCap measures may need to be adapted to Egyptian, Middle Eastern and satisfaction
North African cultures, as recent empirical research renders measurement invariance
and equivalence across cultures at least questionable (Wernsing, 2014).
in Egypt
For practice, Egyptian organizations, as well as global companies that conduct
business operations in Egypt, North Africa and the Middle East, may find PsyCap to be
a new potential source of human-based competitive advantage. For example, PsyCap has 365
been supported as a state-like resource that is open to development through brief human
resource development interventions, with significant impact on performance (Luthans
et al., 2008a, b, 2010). The significant relationship with job satisfaction, supported in
this study, further highlights the importance of developing employees’ PsyCap. PsyCap
development interventions may help employers in dealing with some of the prevalent HR
problems such as indecision, procrastination and indifference (Tuma, 1988). Therefore,
managers need to readdress the prevailing human resource management practices and
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pay special attention to training, organizational development, job redesign, participation

of employees in both goal setting and action plans, and creating an organizational culture
that is more conducive to enhancing hope self-efficacy, resilience, optimism and
consequently PsyCap.

Conclusion
Despite the recent political events, Egypt, North Africa and the Middle East in general
continue to attract foreign direct investment and global business due to the huge market.
While this region continues to face numerous challenges, PsyCap represents an untapped
positively oriented resource that can enhance global competitiveness through enhancing
employee job satisfaction and subsequently performance. The state-like nature of
PsyCap makes it accessible for human resource development efforts. Its underlying
agentic component makes it particularly relevant for promoting initiative, independent
thinking and positive change in a transient political, economic and social environment.

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About the authors

Dr Mohga A. Badran is the Chair of the Management Department at the American University in
Cairo, Egypt. Her research interests concentrate mainly on management of change, management
of conflict, learning organizations and human resource management. Badran holds a PhD in
Business Administration from the Stockholm University, an MA in Management of Information
Systems from the American University in Cairo, and a BSc in Statistics from the Faculty of
Economics and Political Science, the Cairo University. She is a Certified Management Consultant
for the Institute of Management Consultancy, London, UK, and a Certified Coach/Consultant for
Team Learning Labs for the Learning Circle, based in Massachusetts, USA. Since joining the
American University in Cairo, she has helped establish a number of training programs and
diplomas. She has done extensive consulting in the areas of organizational structures, setting
human resource management policies, identifying organizational behavior problems,
organizational development, learning organizations, identifying training needs and helping
human resources to set action plans in related areas. Before she joined the American University
in Cairo, Professor Mohga was an Assistant Professor in the Faculty of Commerce, the Cairo
University, Beni-Seuf Branch. She has also worked as a Researcher in the Economic Section of the
American Embassy in Cairo, the Department of Economics in the Arab League, the Social
Research Center in the American University in Cairo, the Central Agency for Training, and the
Ministry of Planning.
Dr Carolyn M. Youssef-Morgan is the Redding Chair of Business at Bellevue University,
Nebraska, USA, a core Faculty Member in the PhD in Human Capital Management program,
and a leading researcher, author, speaker and consultant on positivity in the workplace.
Besides co-authoring Psychological Capital: Developing the Human Competitive Edge (Oxford
University Press, 2007) with Fred Luthans and Bruce Avolio, her research on psychological
capital has been published in the Journal of Management, Journal of World Business,
Organizational Dynamics, International Journal of Human Resource Management, Journal of
Leadership and Organizational Studies, Journal of Organizational Behavior Management and
 JMP numerous recognized edited volumes such as the Handbook of Positive Psychology and the
Handbook of Positive Organizational Scholarship. She also serves as a voting member on
30,3 the US Technical Advisory Group, designated by the Society for Human Resource
Management (SHRM), the American National Standards Institute (ANSI), and the
International Organization for Standardization (ISO) to create and represent the US’ view
on global human resource standards. Youssef-Morgan received her Bachelor’s and MBA from
the American University in Cairo, Egypt, and her PhD from the University of Nebraska –
370 Lincoln. Dr Carolyn M. Youssef-Morgan is the corresponding author and can be contacted at:
[email protected]
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