Working Paper: NBER ID: w14443
Authors: Henry Sauermann; Wesley M. Cohen
Abstract: We examine the impact of individual-level motives upon innovative effort and performance in firms. Drawing from economics and social psychology, we develop a model of the impact of individuals' motives and incentives upon their innovative effort and performance. Using data on over 11,000 industrial scientists and engineers (SESTAT 2003), we find that individuals' motives have significant effects upon innovative effort and performance. These effects vary significantly, however, by the particular kind of motive (e.g., desire for intellectual challenge vs. pay). We also find that intrinsic and extrinsic motives affect innovative performance even when controlling for effort, suggesting that motives affect not only the level of individual effort, but also its quality. Overall, intrinsic motives, particularly the desire for intellectual challenge, appear to benefit innovation more than extrinsic motives such as pay.
Keywords: employee motives; firm innovation; intrinsic motivation; extrinsic motivation
JEL Codes: O30; O31; O32
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| desire for intellectual challenge (intrinsic motive) (D80) | innovative effort (O36) |
| desire for intellectual challenge (intrinsic motive) (D80) | innovative performance (O35) |
| extrinsic motives (e.g., salary) (M52) | innovative effort (O36) |
| extrinsic motives (e.g., salary) (M52) | innovative performance (O35) |
| motives (L21) | quantity of effort (e.g., hours worked) (J22) |
| motives (L21) | quality of innovative output (e.g., patent applications) (O36) |
| task environment (M54) | effect of motives on performance (D29) |