Incentive Theory of Motivation: Examples & Easy Definition

The Incentive Theory of Motivation suggests humans are motivated by incentives in the form of rewards and punishments.

This theory is a behaviorist theory, underpinned by the research of scholars such as Edward Thorndike and B.F. Skinner. Such theorists demonstrated that rewards (such as praise) and punishments (such as removal of food) can motivate both humans and animals to perform tasks on command.

Such an understanding continues to be utilized in education and training, from giving token rewards for potty training to treats when training a dog.

Incentive Theory Overview

The Incentive Theory of Motivation emphasizes the importance of external stimuli (in layman’s terms, incentives, rewards, disincentives, and punishments) in motivating people to action.

Unlike other motivation theories that focus on internal factors such as instincts (see: instinct theory) or arousal (see: arousal theory), the incentive theory proposes that people are primarily driven by the anticipation of external rewards or the avoidance of negative outcomes.

The key idea in this theory is that we are motivated to perform behaviors that will lead to personally desirable outcomes or avoid behaviors that lead to personally undesirable outcomes.

One of the most influential figures in the development of the Incentive Theory is B.F. Skinner (1904-1990). Skinner proposed the concept of operant conditioning, which asserts that voluntary behaviors are learned and maintained through their consequences.

His work with rats and pigeons demonstrated that rewards (reinforcements) strengthen desired behaviors in animals, while punishments weaken undesirable behaviors.

Building on Skinner, Edward Thorndike (1874-1949), an early behavioral psychologist, demonstrated the Law of Effect. This law states that behaviors that result in satisfying outcomes are likely to be repeated. Similarly, behaviors that lead to unpleasant outcomes are less likely to be repeated.

Clark Hull (1884-1952), another influential psychologist, proposed the drive-reduction theory, which suggests that individuals are motivated to engage in behaviors that reduce internal drives or needs (aka internal stimuli).

Hull demonstrated that external incentives can influence motivation by reducing the discomfort or tension caused by unmet needs.

Key Components of the Incentive Theory of Motivation

1. Incentives: Incentives are the external stimuli or rewards that influence behavior. They can be either positive (known as positive reinforcements) or negative (known as negative reinforcements). Incentives may include tangible rewards such as money, prizes, and free time, as well as intangible rewards like satisfaction, pride, or a sense of accomplishment.

2. Expectancy: Expectancy refers to an individual’s belief about their ability to achieve a specific outcome. In the context of the Incentive Theory, expectancy plays a crucial role in motivation because people are only likely to perform a task if they believe that the incentive is within reach.

3. Valence: Valence refers to the perceived attractiveness or aversiveness of an outcome. In other words, the stronger the reward or punishment, the higher its valence.

4. Goal-Setting: The Incentive Theory posits that setting specific, challenging, and attainable goals can increase motivation. Individuals are believed to be more likely to exert effort to achieve goals that they perceive as desirable and achievable.

Incentive Theory Examples

1. Academic Achievement: A student works hard to be in the top three grade point averages in their class; they are rewarded with extra hours of free time or recess.
2. Law Adherence: A person has a chance to take something for free at a store, and they choose not to break the law for fear of being punished for stealing.
3. Sports Ambition: A sports team wants to earn a trophy for their performance, so they train very hard to succeed during their season.
4. Child’s Incentive: A child is told that if they behave and do something right they will receive a sticker. The child behaves in order to receive the reward.
5. Professional Advancement: An office worker at a company wants to get promoted, so they put in extra time at the office and put more effort into their work-related projects.
6. Classroom Discipline: A student does not want to be sent to the principal’s office for misbehaving in class, so they adjust their behavior and follow the class rules.
7. Language Mastery: A foreign worker living in Taiwan must pass a language test to be hired by a company. They study 5 hours every day to learn the language and pass the test.
8. Job Security: An employee of a company does not leave work early. They choose to follow the rules so that they are not fired from the job.
9. Timely Return: A person rents power tools from a hardware store. They do not want to incur late fee charges, so they return the power tools on the correct date.
10. Weight Loss Incentive: A person is offered a financial reward to lose weight. They go to the gym, exercise, and lose weight in order to feel more confident about their body and obtain the reward.

Criticisms on the Incentive Theory of Motivation

While the incentive theory of motivation is heralded as groundbreaking behavioral psychology, and its applications have been accepted by across multiple fields of study, it has been highly criticized for a number of reasons.

Firstly, it seems to focus strictly on external factors that impact behavior, and often ignores the multitudinous internal factors that drive behavior (e.g., emotions, a person’s personal value system, and cultural beliefs).

Secondly, what motivates one person may not necessarily motivate every person. There is a diversity in human motivation, and many incentive motivation theories oversimplify human behavior.

Thirdly, the incentives many only be effective in the short term. Gneezy et al. (2011) states:

“In the emerging literature on the use of incentives for lifestyle changes, large enough incentives clearly work in the short run and even in the middle run, but in the longer run the desired change in habits can again disappear.” (p.206).

Likely, this is because extrinsic rewards fade, especially when the person receiving the rewards is satiated or habituated to the reward, while intrinsic motivation (doing something for the pleasure of the task, where pleasure is the intrinsic reward) is more sustainable.

Fourthly, the use of incentives may have adverse effects. For example, incentivizing a person for studying with desirable but unhealthy treats may encourage them to study, but may lead to health problems down the track.

Incentive vs Instinct Theories of Motivation

Incentive theory is often contrasted to the instinct theory. The two theories describe motivation from different perspectives.

Whereas incentive theory focuses on conscious, deliberate actions that are under human control, instinct theory is more determinist in nature, arguing that our motivations are based on innate human desires that we have developed through generations of evolution.

For example, instinct theory might hold that we’re primarily driven to take actions based on our biological makeup – a cat will chase a mouse not because it wants to but because it’s made to do it. The cat cannot help itself.

By contrast, the incentive theory holds that the cat will chase the mouse based on rational thought processes: the incentive for catching the mouse is food. If the cat is satiated, it may choose not to chase the mouse at all.

For more on the instinct theory, visit my writeup on instincts in motivation.

Below is a brief table summary contrasting the two theories:

Factor	Incentive Theory of Motivation	Instinct Theory of Motivation
Primary Focus	External stimuli (incentives, rewards)	Innate, biologically determined behaviors
Theorists	B.F. Skinner, Edward Thorndike, Clark Hull, Leon Festinger	William James, William McDougall, Sigmund Freud
Basis for Motivation	Anticipation of rewards or avoidance of negative outcomes. Degree of drive for the reward may be affected by valence of the reward or degree of habituation and saturation.	We are motivated by fixed-action patterns that are pre-programmed into our minds through years of evolution. Our motivations tend to be automatic and based on unlearned responses to stimuli, e.g. a snake does not need to learn how to hunt.
Learning & Adaptability	Motivation can be learned, adapted, and shaped by experiences and environment. As a result, motivational rewards and punishments can be used as the basis for teaching.	Motivation is predetermined and not subject to change. Our drive is biologically determined.
Agency	Decision-makers have agency to choose to engage in a behavior (or not) based on the desirability of the reward or desire to avoid an adverse consequence.	We lack agency because our innate drives – for food, shelter, protection, community, sex, etc. – cannot be denied. Our brains are wired to seek them out.

Conclusion

The incentive theory of motivation continues to be utilized in a range of fields, from education to parenting to public policy. While it tends to be a highly effective strategy in the short-term, its long-term effects and consequences (due to its lack of moral compass) mean it is often derided as a Band-Aid rather than a solution to demotivation.

References

Berridge, K. C. (2000). Reward learning: Reinforcement, incentives, and expectations. Elsevier EBooks, 223–278. https://doi.org/10.1016/s0079-7421(00)80022-5

Gneezy, U., Meier, S., & Rey-Biel, P. (2011). When and Why Incentives (Don’t) Work to Modify Behavior. Journal of Economic Perspectives, 25(4), 191–210. https://doi.org/10.1257/jep.25.4.191

Jeffery, R. W. (2012). Financial incentives and weight control. Preventive Medicine, 55, S61 -S67. https://doi.org/10.1016/j.ypmed.2011.12.024

Krishnan, I. (2014). A Review of B. F. Skinner’s ‘Reinforcement Theory of Motivation. Journal of Research in Education Methodology. 5. Accessed April 4^th, 2023 from https://www.researchgate.net/publication/306091479

Liu, W., & Liu, Y. (2022). The Impact of Incentives on Job Performance, Business Cycle, and Population Health in Emerging Economies. Frontiers in Public Health, 9. Doi: https://doi.org/10.3389/fpubh.2021.778101

Saracho, O. N. (2021). Theories of Child Development and Their Impact on Early Childhood Education and Care. Early Childhood Education Journal, 51(1), 15–30. https://doi.org/10.1007/s10643-021-01271-5