The overjustification effect is a phenomenon in psychology in which providing expected external incentive, such as money or prizes, for an already intrinsically rewarding activity can reduce a person's intrinsic motivation to perform that activity. It is commonly understood in terms of the interaction between intrinsic and extrinsic motivation, where external rewards may undermine pre-existing intrinsic interest, a process often described as motivational "crowding out". The effect has been widely discussed in research by Edward Deci and Mark Lepper. Once rewards are no longer offered, individuals may show reduced interest in the activity, namely, cognitive re-evaluation, although the extent of this effect can vary depending on contexts.
Theoretical mechanisms Several theoretical frameworks have been used to explain the overjustification effect, particularly focusing on the distinction between intrinsic motivation (when a person does the activity in the absence of a reward contigency or control) and extrinsic motivation (the activity with a reward contigency or control).
Self-perception theory According to self-perception theory, developed by psychologist Daryl Bem, a person infers his or her own internal states based on external conditions and constraints to some extent. Bem’s self-perception theory believes that when a salient external incentive is present, individuals may attribute their behaviour to that external cause rather than to intrinsic interest. This process of self-inference is particularly likely when external constraints are strong (such as the presence of a reward) or when internal cues are weak or ambiguous. As a result, the activity may be reinterpreted as being performed for the rewards rather than for its inherent enjoyment. Over time, this would lead a person to conclude that he or she is performing the behavior solely for the reward, which shifts the person's motivation from intrinsic to extrinsic. A classic example comes from an experiment by Leon Festinger and James M. Carlsmith (1959), in which participants were asked to complete a boring task and then tell another fellow student that it was enjoyable. Afterwards, participants were asked how much they had enjoyed the task. Those who were paid only $1 evaluated the task as significantly more enjoyable than those who received $20. This is because individuals who receive low compensation ($1) are more likely to rule out financial incentive as a motivating factor in their thinking process, and instead infer that their behaviour reflected genuine interest. When the external reward is subsequently removed, individuals may be less likely to engage in the activity, providing a theoretical explanation for the overjustification effect.
Cognitive evaluation theory Laboratory studies in the 1970s indicated that individuals under conditions with extrinsic rewards showed diminished intrinsic motivation. Deci and his colleagues developed the cognitive evaluation theory to explain the underlying causes. As a sub-theory of self-determination theory, cognitive evaluation theory proposes that intrinsic motivation is shaped by individuals’ perceived locus of causality (PLOC), referring to whether individuals feel free to follow their inner interests, as well as by individuals’ experience of autonomy and competence. According to this framework, external rewards and other contextual factors can influence intrinsic motivation by shifting individuals’ PLOC. Intrinsic motivation may increase if rewards are interpreted as pertaining positive information about an individual’s competence and self-control. In contrast, if individuals perceive the results as indicative of external control, this decreases their feelings of self-control and competence, which in turn decreases intrinsic motivation. It underlies the overjustification effect, as rewards perceived as controllong would shift the locus of causality and reduce intrinsic motivation. In general, this account is broadly consistent with Self-perception theory, which similarly emphasises the importance of external cues in changing individuals’ intrinsic motivation, although the Cognitive evaluation theory specifies more on the extent to which people feel like they originate their behaviour.
Self-determination theory Self-determination theory (SDT) is a theory of human motivation that focuses on how individuals internalise, or take on, goals and values as their own. It further distinguishes between different forms of extrinsic motivation, ranging from external regulation to more autonomous forms such as identified and integrated regulation. This continuum highlights that the impact of rewards on intrinsic motivation depends on the extent to which behaviours are internalised and experienced as self-determined. The distinction answers why some rewards undermine intrinsic motivation while others do not. SDT is also a broad theory that extends the predictions of Cognitive evaluation theory to a wider range of contexts, including work organisations.The theory differentiates between various types of motivational states, distinguishes the organisational conditions where extrinsic rewards are more effective than intrinsic rewards, examines individual differences in orientation toward intrinsic versus extrinsic motivation and discusses managerial behaviour that can enhance intrinsic motivation. Findings from the Deci et al. (1989) study have supported Self-determination theory as an approach to work motivation by showing how managers can impact the work attitudes of their employees. For example, the study reported that managerial autonomy support which included provision of options, giving relevant information in a non-autonomous way, acknowledging subordinates' perspectives and cultivating self-initiation resulted in employees having more positive work-related attitudes such as higher level of job satisfaction and increased level of trust in corporate management. This perspective suggests that the overjustification effect is not universal, but depends on whether rewards are perceived as supporting or constraining basic psychological needs.
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