Agency Model, Intrinsic Motivation, Cost of Raising Intrinsic Motivation, Process-Oriented Performance-Based Pay, Productivity
This study expands on the agency model to analyze how Japanese companies intrinsically motivate their workers. Some previous studies have considered the intrinsic motivation of agents. However, they analyze monetary motivation methods that take into account workers’ intrinsic motivation or a simultaneous analysis of monetary motivation methods and the cost of raising intrinsic motivation that also takes into account workers’ intrinsic motivation.
However, while it is not always easy to change a monetary incentive system, the cost of raising intrinsic motivation is easier to change. Therefore, this study models the cost of raising intrinsic motivation as the only decision-making variable. The performance-based wage system (process-oriented pay) is regarded as a given (i.e., it is not regarded as a decision-making variable).
We obtained the following results:
1. When productivity is high, it is effective to spend money to increase intrinsic motivation.
2. When the weight of process-oriented performance-based pay is small, it is effective to spend money to raise intrinsic motivation (conditionally).
3. When cost sensitivity is low, it is effective to spend money to raise intrinsic motivation.
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"Model Analysis on the Improvement of Intrinsic Motivation at Japanese Companies,"
Japanese Society and Culture: Vol. 4, Article 8.
Available at: https://gensoken.toyo.ac.jp/japanese-society-and-culture/vol4/iss1/8