An investigation of agency theory's assumption of strict effort aversion : the role of intrinsic motivation

Author

M. Cathy Sullivan

Date of Award

5-1994

Degree Type

Dissertation

Degree Name

Doctor of Philosophy

Major

Business Administration

Major Professor

A. Faye Borthick

Committee Members

Harold P. Roth, Michael G. Johnson, R. Thomas Ladd

Abstract

Agency theory assumes that individuals are effort averse and that extrinsic rewards are necessary to motivate individuals to increase effort and improve performance. This research used a laboratory experiment to challenge agency theory's assumption of strict effort aversion. The organizational psychology literature contains several motivational theories that suggest an individual's intrinsic motivation induces effort exertion even in the absence of external motivation. Specifically, this research examined the relationship between effort and two intrinsic motivation factors, work ethic and need for achievement. Subjects performed a simple character decoding task designed to elicit effort differences. An increase in effort on an information transfer task of this type should result in improved performance. Therefore, effort was operationalized as performance, measured as productivity and quality. Subjects were classified as high work ethic or low work ethic individuals based on their individual score on the Protestant Ethic Scale (Mirels and Garrett, 1971). Consistent with motivational theories that contend an individual's intrinsic motivation induces voluntary effort exertion when performing a task, high work ethic individuals were more productive and produced higher quality output than low work ethic individuals. A scale adopted from the Edwards Personal Preference Schedule,/i> (Edwards, 1983) measured individuals' need for achievement. No difference in productivity or quality existed between high need for achievement individuals and low need for achievement individuals. The task used in the experiment was a very simple one, which may have failed to elicit the intrinsic motivator, need for achievement. This research also examined how intrinsic motivation factors interact with time pressure to affect job performance. Time pressure significantly affected productivity but had no effect on quality for the task used in this experiment. No interaction existed, however, between the intrinsic motivation factors examined in this study and time pressure. High work ethic individuals were more productive and had higher quality output than low work ethic individuals under no time pressure and under imposed time pressure. No difference in productivity or quality existed between high need for achievement individuals and low need for achievement individuals under either no time pressm-e or imposed time pressure.