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hubie [soylentnews.org] writes:

Employees are motivated by rewards that are perceived as distinct from salary [uwaterloo.ca]:

Tangible rewards motivate employees when they're easy to use, pleasurable, unexpected, and distinct from salary, a new study found.

A recent survey of firms in the United States revealed that 84 per cent spent more than $90 billion annually on tangible employee rewards, such as gift cards, recreation trips and merchandise in hopes of increasing productivity.

[...] Presslee and his co-author, University of Wisconsin-Madison's Willie Choi, used four experiments to investigate the factors driving the preference between cash and tangible rewards. The attributes examined include ease of use of the reward (fungibility), hedonic nature of the reward (want vs. need), the novelty of the reward, and how the reward is presented.

"Rewards are constellations of attributes, and firms should focus more on the motivational effects of the attributes associated with a reward rather than the reward type itself," Presslee said. "Results confirmed that each of these attributes – individually and in combination – increases employee effort and performance."

The researchers recommend managers interested in motivating employees using tangible rewards would be best served to offer tangible rewards that incorporate these four attributes.

It would not surprise me if the effect was the same for cash, provided that the cash was handed directly to the employee instead of being added to their paycheck.

Journal Reference:
Jongwoon (Willie)Choia and AdamPresslee, When and why tangible rewards can motivate greater effort than cash rewards: An analysis of four attribute differences [open], Accounting, Organizations and Society, 2022. DOI: 10.1016/j.aos.2022.101389 [doi.org]

Original Submission