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Business & Marketing
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THE INCENTIVE THEORY. Business & Marketing Essay. (Essay Sample)


The task was to investigate a notion of THE INCENTIVE THEORY


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Incentive theory emphasizes the role of external stimuli that focus on motivating employees' behavior in a work environment. Incentive theories argue that external stimuli are key factors that motivate employees to achieve their desired goals. According to this theory, employees are pulled by factors that offer positive incentives and are pushed away by negative incentives (Beckmann & Heckhausen, 2018). Thus, employees in a high-stress work environment are motivated to take risks and attain economic rewards. Incentives include various desirable rewards like money, status, acceptance, or recognition. Authors of the incentive theory hold that variable rewards are enough to induce the desired behaviors.
In an empirical study, Ankudinov, Lebedev & Sachenkov (2015) surveyed Russian employees to examine improved productivity. The study revealed that monetary incentives played a leading role in terms of increasing productivity. Moreover, it showed a specific decline in performance during the crisis years between 2009 and 2010. 

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