Many studies have demonstrated that extrinsic rewards (including financial incentives) tend to undermine intrinsic motivation, an effect often referred to as “the undermining effect.”
A meta-analysis of 128 studies on the undermining effect found that performance-contingent rewards increase extrinsic motivation while the contingency is in place, but
at the expense of decreasing intrinsic motivation [30].
Moreover, the resulting decrease in intrinsic motivation persists well after the contingency is removed (i.e., poor maintenance).
SDT posits that the negative relation between extrinsic rewards and intrinsic motivation can be explained by the fact that contingent rewards have a tendency to feel subtly controlling, thwarting peoples’ psychological need for autonomy, and distracting them from potentially enjoyable aspects of the targeted activity