Transformational and transactional leadership, which focus on the relationship between leaders and employees, are the most recent development of leadership theories. Yet studies on the impact of gender and culture on transformational and transactional leadership styles are limited. This Master Dissertation therefore aims to shed new light on that issue. First, it attempts to compare leadership styles adopted by managers of SMEs in China and Sweden. Second, it tries to evaluate which element - gender or culture - exerts a more important influence upon leadership styles.

Based on empirical researches, ten hypotheses are formulated and a new model is developed in the dissertation. In addition, the deductive approach is chosen as methodology and quantitative data is gathered with the help of an empirical study of an online questionnaire.

Eventually, the present research indicates that both Chinese managers and Swedish managers of SMEs are prone to be more transformational than transactional. It also shows that there is no gender influence upon leadership styles. In contrast, culture exerts a little more impact on leadership styles of SMEs in China and Sweden.

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