Bias/Heuristic

Extrinsic Incentive Bias

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The extrinsic incentives bias is an attributional bias which indicates that people are more likely to attribute to "extrinsic incentives" (i.e. monetary rewards) than "intrinsic incentives" (such as learning a new skill) when considering the motivations of others. In contrast, when attributing their own motivations, people are more likely to attribute it to intrinsic incentives rather than extrinsic.

For example, a study showed that when MBA students were asked to attribute the motivations of Citibank service representatives, they attributed extrinsic incentives as most important and intrinsic as least important. However, when the service representatives were asked to rank their actual motivations, they indicated that intrinsic factors (e.g. learning new skills, accomplishing tasks etc.) were more important motivators than extrinsic factors (e.g. money, job status etc.).

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