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Incentive Theory of Motivation and How it works

What drives your every physical movement? Do you get up and head for a ten-mile run every day because you think it is good for your health, or is there anything external that excites you to run? Could it possibly be the “Runner’s High” we constantly hear about? Motivation is something that works as the force that prompts, guides, and sustains goal-oriented behaviors in people. Motivation is the push that moves everybody to perform certain actions or engage in physical behaviors. This involves anything from buying headphones to pursuing a medical degree or traveling around the world to find the love of your life. 

Millions of diverse forces influence motivation in people, including emotional, physiological, social and cognitive forces. Based on how vast the feeling of motivation is, several theories have been evolved to explain every side of this feeling. 

One of these theories is the incentive theory of motivation! 

Incentive Theory of Motivation 

The incentive theory of motivation suggests that human behavior is motivated by the drive of external factors, also known as incentives. The theory states that people tend to behave in a way that will result in a reward or avoid negative actions that may bring down punishment.

There are ALWAYS different reasons why people do certain things. Sometimes, these reasons are internal wishes or longings. Other times, physical behaviors in people are pulled by the desire for external rewards, also called “incentives”. 

Incentives include all kinds of external bonuses and punishments such as promotion or demotion in the job, increased pay, consideration and appreciation, penalties and fines, allowances, and money.

These incentives offer a feeling of pleasure, joy, and satisfaction or a sense of dissatisfaction and fear of failure that serves as a driving force for motivating a person. 

For example, an employee working hard every day to get a raise or a ten-year-old boy sets a lemonade tent around the corner to earn some pennies. Here the incentives for hard work are ‘promotion’ and ‘money’ which are both pulling forces of motivation. 

History of The Incentive Theory of Motivation

“Building on the base established by drive theories, incentive theories emerged in the 1940s and 1950s. Incentive theories proposed that the behavior is motivated by the ‘pull’ of external goals, such as rewards, money, or recognition. 

It’s easy to think of many situations in which a particular goal, such as a promotion at work, can serve as an external incentive that helps activate particular behaviors.” — Hockenbury & Hockenbury, 2003

Besides, who is the founder of the incentive theory of motivation?

— Shreena Desai 

It is easy to think of situations where your actions were significantly influenced by a promise, reward, money, or punishment. Maybe the time you studied for hours every day to pass a competitive entrance exam, the time you worked part-time to buy a new bicycle, or the time you started off with an online course to get better at ecommerce.

All of these points in your life showed that your actions were somehow influenced by an external pull to gain something in return for your efforts. 

How does it work? 

As contradictory to different theories of motivation (like the arousal theory, drive-reduction theory of motivation, and instinct theory) that suggest you are pushed into certain behaviors by internal factors, the incentive theory shows how you get driven into action by external factors. 

You can link the incentive theory of motivation to operant conditioning, where actions are performed to either gain rewards or avoid punishment. 

In simpler words, operant conditioning shows: 

  • Behavior that is followed by rewards will be strengthened and have a better chance at recurring in future. If you hit a home run and everyone cheers you up, there is a good chance that you will try to hit a home run again in future matches. 
  • Behavior that is followed by punishment will be diminished and is less likely to occur again. If you tell a lame joke in class and nobody laughs, there is a low chance that you’ll make the same joke again. 

This is how the incentive theory of motivation can be associated with operant conditioning in many places. As it is almost clear by now, there are two types of incentives, positive and negative. 

Positive Incentives

The incentives that offer a guarantee of satisfaction, reinforcement, or reward are positive incentives. These incentives are based on the principle of optimism and are provided to satisfy a person’s needs and wants. 

Positive incentives include bonuses, car-gift, promotion in job, allowances, prizes, a raise, kisses, money and so on. These are rewards, and they offer pleasure and satisfaction to an individual. 

For instance, a parent pays their son some money to clean the garden. This makes him want to stand forward anytime there is another gardening job in the future. 

Negative Incentives 

In contradiction to positive incentives, the incentives that threaten the benefits of an individual or cause dissatisfaction are known as negative incentives. These incentives are based on the principle of conditioning and are provided to prevent errors and mistakes of an individual for positive results. 

Most of the time, negative incentives are used when positive incentives do not result in satisfying outcomes. Negative incentives include penalties, demotion in jobs, charges, jail, fines, toxic relationships, arguments, and so on. These are things that give displeasure and dissatisfaction. 

For instance, a teacher makes their student stand outside of the class because of disrespectful behavior. This makes the student feel embarrassed and become a better person. You learn from your mistakes. 

Application of the Incentive Theory of Motivation  

The Incentive Theory of Motivation is applied in many fields and industries; one of the largest industries that make use of this theory is  in—business management. 

Monetary and non-monetary incentives are offered to employees in a particular company to motivate them in their work. 

  • Non-monetary incentives include rewards and recognition, flexibility at work, one-on-one lunch, experiential prizes, an extra day off, opportunities, job enrichment, and job security.  
  • Whereas the purpose of monetary incentives is to reward employees for their excellent performance at work through money. Monetary incentives include project bonuses, stock options, scheduled bonuses, profit sharing and even a paid vacation! 

Comparison with Drive-Reduction Theory 

The incentive theory of motivation is significantly different from the other theories based on the direction of motivation. 

According to the Drive Reduction Theory, the primary force behind motivation is the deduction of drives, whereas the incentive theory suggests that external drives are the main force of motivation. 

The Drive-Reduction theory is based on the ideology of homeostasis, a state of the human body where it actively works to maintain a specific type of balance. For instance, when it gets freezing, your body regulates its temperature to ensure that you do not get too cold.  

The theory suggested that all the motivation arises in times of biological or physiological needs. Thirst, hunger, and sex are all examples of drives. 

In simpler words, a drive is something that creates an unpleasant state of tension that needs to be deducted. In an attempt to get rid of this tension or unpleasant state, humans and animals get the motivation to seek out ways that can fulfil biological or physiological needs. 

The Drive-Reduction theory, in comparison to the Incentive Theory of Motivation, is significantly different. Both of the theories work opposed to each other! 

Why are some incentives more motivating than others?

It is safe to say that not all incentives are equal, and the rewards that excite and incite you may not be motivating for another person. All kinds of forces, including physiological, social, and cognitive forces, play a role in determining what incentives can drive you to take action. 

For example, you are more likely to score high in your test by the promise of a PS5 gaming console, while another person may prefer an XBOX. A young girl might be motivated to learn how to cook noodles when she’s actually hungry versus when she is full. A teenage boy cleaning their bed for just consideration, while his brother does it for allowances.

These examples show how something that is so motivating to Person A isn’t necessarily the same for Person B. It also shows how the incentives can stop being motivating in different situations. 

“The value of an incentive can change over time and in different situations,” writes Stephan L. Franzoi in his text Psychology: A Discovery Experience.

“For example, gaining praise from your parents may have positive incentive value for you in some situations, but not in others. When you are home, your parents’ praise may be a positive incentive. However, when your friends visit, you may go out of your way to avoid receiving parental praise because your friends will tease you.” 

Therefore, not all incentives are equal in nature and motivating to every single person in the world. Everyone has their own positive and negative incentives, and some incentives are always more motivating than the others. 

Extrinsic Incentive Motivation (EIM) & Intrinsic Incentive Motivation (IIM)

It’s all pretty understandable: your actions are triggered by a certain motivating factor (incentives), and when the goal is reached, the incentive for that action fades away. 

For example, the action of cooking food is simply motivated by the feeling of hunger, and as soon as you’re full, there is no interest in cooking food anymore until you get hungry again. The same is for many things in life like money, sex, appreciation, fun, joy, and everything else. 

There are two main types of incentives. Let’s discuss both intrinsic incentives and extrinsic incentives in more depth: 

Intrinsic Incentive Motivation (IIM)

Intrinsic motivation is an action that is driven by the satisfaction of internal rewards. For example, an athlete running a marathon for the experience rather than the trophies. 

It is an interest in the action itself and exists inside the individual rather than relying on external rewards or pressure of punishment. 

The intrinsic reward is primarily based upon personal satisfaction an individual receives from mastering a skill and relying on the lesson only for gratification. You can also interpret an intrinsic incentive as a reward or incentive to learn since both are gratifications. IIM examples include: 

  • Participating in a football tournament because it is fun and you enjoy it instead of doing it to win a medal.
  • Cleaning your room because you want a clearer headspace. 
  • Learning a new language because you like experiencing new things in life 
  • Playing cards because it can be a fun and friendly time rather than playing cards for gambling.
  • Going for a run in the morning because you like the cold breeze and sunrise
  • Exercising because you love the workout instead of doing it to grab attention.
  • Taking on more responsibility at the workplace because you enjoy feeling challenged and like the feeling of leadership, rather than doing it to get a promotion.
  • Studying hard to get good grades because you like the adrenaline rush that comes with positive results.
  • Having sex because you like it rather than doing it because your friends tease you for being a virgin. 

All of these are examples of Intrinsic Incentive Motivation, and they focus on one point—you do the activity because it feels internally rewarding.  

Extrinsic Incentive Motivation

Extrinsic motivation is an action that is driven by the satisfaction of external rewards. For example, an athlete running a marathon for the gold medal, rather than the experience. 

In extrinsic motivation (the incentive theory of motivation), rewards and other reinforcements like praise, money, and fame are used to motivate an individual to perform specific actions. 

There might be a lot of fun things you can do at home, but you still go to work as you’re directly affected by extrinsic incentives like money or bills. This example simply means that you’re extrinsically motivated by the ability to afford your monthly expenses. 

Extrinsic motivation does not always have a tangible reward and can also be put into work through abstract rewards, like fame or praise and appreciation. EIM examples include: 

  • Competing in different sports, such as cricket or football, for trophies and fame.
  • Waking every day at the same time and going to work for money.
  • Studying and working hard to get good grades for a gaming console gift.
  • Completing your girlfriend’s homework for kisses.
  • Buy one, get one free sales.
  • Spending hours at the gym to become the best version of yourself so that you can impress other people. 
  • Going on a run every morning to lose weight and aid in fat loss. 

Such kinds of extrinsic motivation incentives may be more effective for some people than they are for others. The benefits of external rewards or incentives are enough for people to be motivated and offer high-quality continuous work. 

The Importance of Intrinsic Incentives 

Whereas extrinsic motivation only gets you titles, money, or rewards, intrinsic incentives work more for meaning, purpose, service and duty, learning, and growth. 

Getting stuck with the benefits of extrinsic incentives is very easy, and our society encourages extrinsic motivation in every sector. However, it is crucial to balance extrinsic with intrinsic motivation. A few reasons why this is necessary: 

  • You take a look at the bigger picture

External factors like your job, your final exams, your fame can be short-living. If you spend too much time and attention on these things, you may often worry about the short-term changes that can happen. 

However, if intrinsic incentives drive you, you have the mental and physical strength to look through a longer-term perspective and see the bigger picture. Intrinsic incentives keep you optimistic about the future! 

  • You understand not everything is controllable.

No matter how competent or talented you are, you possibly cannot control the unexpected elements of luck. When all you’re driven by are extrinsic incentives, you set yourself for major disappointment as there is always a chance of loss, failure, or setback caused by uncontrollable factors. 

On the other hand, when you’re intrinsically motivated, even if you result in a loss or failure, you see the uphill learning from your mistakes. Intrinsic incentives make you believe in a greater purpose! 

  • You do not feel dependent on what other people think.

When extrinsic incentives drive you, you feel dependent on external factors such as validation, praise or appreciation to make you feel confident. Extrinsic motivation makes you insecure and over-concerned about what other people say and think of you. 

Whereas in situations where intrinsic incentives drive you, what other people say does not matter to you. You shrug off toxicity, naysayers, the judgers and doubters. 

It is so much better to have intrinsic incentive motivation that drives you to get the things that you want in life. It can make you unstoppable as nothing external can ever affect you. 

Bottom Line 

Look inside your mind and body and understand what motivates you to work on your goals. Are you trying to avoid a negative consequence, or are you trying to gain rewards or reinforcement? 

Understanding what part of the incentive theory of motivation drives you to take actions for your goals can help you determine how to motivate yourself best. 
If there is something that still motivates the hard worker in you, let me know!

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