âRewards do not undermine peopleâs intrinsic motivation for dull tasks because there is little or no intrinsic motivation to be undermined.â â Daniel H. Pink
Having established that Motivation 2.0 is outdated, Pink dives into the specific ways that carrots and sticks can backfire. Drawing on decades of research in psychology and behavioral economics, he identifies seven deadly flaws of the traditional reward-and-punishment approach â plus two special circumstances where carrots and sticks can still work.
Pink names one of the most important phenomena in motivation science after Mark Twainâs famous character. In The Adventures of Tom Sawyer, Tom tricks his friends into painting a fence by acting as though it is a great privilege rather than a chore. His friends end up paying Tom for the right to do his work.
The Sawyer Effect describes two related phenomena: rewards can turn play into work (undermining intrinsic motivation), and under the right conditions, they can also turn work into play. When an external reward is attached to an inherently interesting task, people begin to see the task as a means to an end rather than an end in itself. The joy drains out of the activity.
This is not mere theory. It has been demonstrated in dozens of carefully controlled experiments over four decades. The implications for workplaces, schools, and families are profound.
When people are paid to do something they already find interesting, their intrinsic motivation decreases. Mark Lepper and colleagues at Stanford demonstrated this in the famous nursery school experiment: children who loved drawing were offered a âGood Playerâ certificate for drawing. Two weeks later, those children spent significantly less time drawing voluntarily than children who had never been offered the reward. The reward transformed play into work.
This effect is remarkably consistent across age groups, cultures, and types of activities. Tangible, contingent, expected rewards â âif you do this, then youâll get thatâ â almost always reduce intrinsic motivation for interesting tasks.
Higher rewards should produce better performance, right? For simple, mechanical tasks, they often do. But for tasks requiring even rudimentary cognitive skill, larger rewards actually lead to poorer performance. Dan Ariely and colleagues tested this in rural India, offering participants the equivalent of a dayâs pay, two weeksâ pay, or five monthsâ pay for performing various tasks. Those offered the largest rewards performed worst.
The London School of Economics analyzed 51 studies of corporate pay-for-performance plans and concluded: âWe find that financial incentives can result in a negative impact on overall performance.â
Teresa Amabileâs research at Harvard Business School has shown that external rewards narrow our focus. This is useful when the path to a solution is clear â but disastrous when creative thinking is required. Her âcandle problemâ experiments and commissioned-art studies consistently show that the expectation of a reward constrains the wide, exploratory thinking that creativity demands.
Artists who created commissioned work â art made for an external reward â were judged by independent experts as significantly less creative than those who created non-commissioned work. The very same artists produced better work when no reward was on the line.
When a day care center in Israel began fining parents who arrived late to pick up their children, late arrivals actually increased. The fine transformed a moral obligation (âI should be on timeâ) into a simple business transaction (âI can buy extra timeâ). When the fine was eventually removed, the late behavior persisted â the social norm had been permanently displaced by the market norm.
Economists Uri Gneezy and Aldo Rustichini call this the crowding-out effect. Blood donation rates drop when donors are paid, volunteering decreases when it comes with a stipend, and charitable behavior declines when it is explicitly incentivized.
When the reward becomes the goal, people will find the fastest path to it â even if that path is dishonest. Enronâs aggressive bonus structure incentivized executives to manipulate earnings. School districts that tie funding to test scores see increases in teacher cheating. Goals that are too specific and too aggressively incentivized create tunnel vision and ethical blind spots.
Research shows that people who are focused on reaching a goal are more willing to engage in unethical behavior to achieve it. The goal narrows their vision so much that they lose sight of the broader implications of their actions.
Like many addictive substances, extrinsic rewards deliver a burst of pleasure that quickly fades. Over time, the same reward produces less satisfaction, requiring ever-larger rewards to achieve the same effect. Russian economist Anton Suvorov modeled this dynamic and showed that once you start paying someone to do something, you have to keep paying them â and eventually pay them more â to maintain the same level of effort.
This creates a dangerous cycle: the initial reward replaces intrinsic motivation, and then the reward itself must be continually escalated. Organizations that rely heavily on bonuses find themselves trapped in an escalating arms race of incentives.
Quarterly earnings targets, annual bonus cycles, and short-term sales goals all focus attention on the near term at the expense of long-term value. Researchers have found that companies that spend the most time offering earnings guidance â managing the carrots and sticks of Wall Street expectations â actually produce lower long-term growth rates than those that do not.
The 2008 financial crisis was, in many ways, a catastrophic failure of short-term incentives. Traders and executives were rewarded handsomely for short-term gains, with no mechanism to account for the long-term risks they were creating.
Pink is careful to note that carrots and sticks are not always harmful. For routine, algorithmic tasks that are not inherently interesting, traditional rewards can be effective.
The task is routine and algorithmic: When work is straightforward and can be reduced to a set of instructions, if-then rewards can boost performance without significant downsides. The work is not intrinsically motivating, so there is no intrinsic motivation to undermine.
The reward is unexpected and offered after the fact: âNow thatâ rewards â given after the task is complete, without being announced in advance â do not undermine intrinsic motivation because people were not focused on the reward while doing the work.
Pink introduces a framework for understanding different motivational orientations, inspired by the work of psychologists Meyer Friedman and Ray Rosenman on Type A and Type B personalities.
Type X behavior is fueled primarily by extrinsic desires. People operating in Type X mode are driven by external rewards â money, status, praise, or fear of punishment. Type X behavior is concerned less with the inherent satisfaction of an activity and more with the external rewards to which the activity leads.
Type I behavior is fueled primarily by intrinsic desires. People operating in Type I mode are driven by the freedom, challenge, and purpose of the activity itself. Type I behavior is self-renewing: because the motivation comes from within, it does not depend on an ever-escalating supply of external incentives.
Type I behavior is not anti-money. Type I individuals want to be paid fairly and adequately. But once baseline compensation is handled, additional financial incentives are not their primary driver. Type I behavior, in the long run, almost always outperforms Type X behavior â and promotes greater physical and psychological well-being.
Consider your own work: are you operating more in Type X or Type I mode? What rewards motivate you most â the external ones (bonuses, promotions, recognition) or the internal ones (learning, growth, meaning)? How might shifting toward Type I change your experience of work?