How Do Financial Incentives Affect Intrinsic Motivation?
An important argument against the use of financial incentives is that they crowd out intrinsic motivation (if it exists). This argument can be traced back to Lepper, Greene, and Nisbett s (1973) finding that after being paid to perform an activity they seemed to enjoy, participants invested less effort in the activity when payoffs ceased. Lepper et al. interpreted participants initial apparent enjoyment of the activity as evidence of intrinsic motivation and their subsequent decrease in effort expenditure as evidence of the negative impact of extrinsic rewards on intrinsic motivation. A huge literature has evolved consequently. Drawing on an extensive meta-analysis by Cameron and Pierce (1994), Eisenberger and Cameron (1996) performed a meta-analysis on the question of whether financial incentives really undermine intrinsic motivation. Based on their examination of two main measures of intrinsic motivation, namely, the free time spent on the task post-reward and the expressed attitude
