NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

What Makes Them Tick? Employee Motives and Firm Innovation

Henry Sauermann, Wesley M. Cohen

NBER Working Paper No. 14443
Issued in October 2008
NBER Program(s):   PR

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.

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Document Object Identifier (DOI): 10.3386/w14443

Published: Journal Management Science archive Volume 56 Issue 12, December 2010 Pages 2134-2153 INFORMS Institute for Operations Research and the Management Sciences (INFORMS), Linthicum, Maryland, USA table of contents doi>10.1287/mnsc.1100.1241

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