Revisiting the Effects of Economic Incentives on Motivation

Kameliia Petrova

Department of Economics and Finance, State University of New York, Plattsburgh, USA.

DOI: 10.4236/tel.[phone]                

Abstract

This paper presents a formal framework for modeling the effects of economic incentives on motivation. While economic models represent the utilities from monetary incentives and private benefits in an additive form, studies in psychology show that extrinsic and intrinsic motivation are non-additive and that there exists a continuum between the two. To accommodate for possible interaction effects, a non-additive probability model and evidence theory have been used in the principal-agent set-up. The model produces results consistent with prior evidence presented in social psychology studies.

Keywords

Incentives; Intrinsic Motivation; Non-Additive Probability

Conflicts of Interest

The authors declare no conflicts of interest.

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