The Impact of Rewards on the Motivation of Low-Income Employees

Abstract

This thesis examines the impact of rewards on the motivation of low-income employees and studies its short-term and long-term effects. Using a theoretical framework including Self-Determination Theory (SDT), Vroom's Expectancy Theory, Adams' Equity Theory, and Skinner's Reinforcement Theory, this research analyzes how financial and non-financial rewards affect intrinsic and extrinsic motivation among this specific group of employees. The research emphasizes the importance of meeting basic psychological needs, ensuring fairness, and maintaining transparency in reward systems for sustaining motivation over time. Through a mixed-methods approach, including a comprehensive literature review and field research using questionnaires distributed among 40 low-income employees with over ten years of experience, this study shows that while financial rewards effectively increase short-term motivation by addressing immediate economic needs, their long-term effectiveness diminishes if not accompanied by non-financial incentives. Key findings highlight the necessity of balancing intrinsic and extrinsic motivation by integrating opportunities for professional growth, recognition, and fair distribution of rewards. The research concludes by providing practical recommendations for designing sustainable reward systems, such as increasing transparency, combining financial and non-financial rewards, ensuring fairness, and supporting employees' psychological needs. These strategies are designed to enhance productivity, job satisfaction, and organizational commitment, providing valuable insights for managers and policymakers in human resource management.