Optimistic employees often show positive outcomes, such as happiness, job satisfaction and commitment. While entrepreneurs generally are considered to be optimists, the concept of whether entrepreneurs can transfer their optimism to their employees in order to improve the state optimism of their employee has not been studied. The concept of state optimism, entrepreneur expressivity and relationship quality are discuss in relation to this study. Hypotheses were developed based on the suggested impact aspects of entrepreneur expressivity and relationship quality would affect the transfer of optimism from the entrepreneur to their employees. Our research intends to fill such a research gap by studying employees at 328 SMEs. We find that entrepreneur's optimism is indeed contagious and does improve employee state optimism. We discuss the implications of our findings, and make suggestions for future research. Key words: entrepreneur, employee, optimism, contagious, transfer
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