Abstract: In organizational management, it is interesting and crucial to investigate whether top managers’ unethical behavior trigger employees to behave unethically even though they have little chance to directly interact with each other. Academia has defined such indirect social influence alongside the organizational hierarchy as trickle-down effect. However, less is known about the mechanisms and boundary conditions of the trickle-down effect of unethical behavior. Based on the framework of trickle-down effect and social learning theory, this study develops a multilevel moderated mediation model linking top managers, middle managers and employees. By collecting time-lagged and multisource data (87 teams and 450 employees) in a national high-tech industrial park and analyzing the data using Mplus 7.4, the present study finds that: (1) top managers’ unethical behavior is positively related to middle managers’ unethical behavior, and middle managers’ unethical behavior is positively related to employees’ workplace deviance; (2) middle managers’ unethical behavior mediates the relationship of top managers’ unethical behavior and employee workplace deviance; (3) the social exchange between top and middle managers moderates their positive influence of unethical behavior; (4) the social exchange between middle managers and employees moderates the relationship of middle manager unethical behavior and employee workplace deviance. This study not only enriches research on the spread of unethical behavior in organizations, but also inspires leaders to lead by example. Contributions, limitations, and future research direction are also outlined.

Key words: trickle-down effect, unethical behavior, social learning theory, workplace deviance