An Experimental Study on the Role of Monetary Rewards in the Relationship Between the Quantity and Quality of Employees’ New Venture Ideas

Articles in Press

Document Type : Research Article

Authors

1 Department of Corporate Entrepreneurship, Faculty of Entrepreneurship, University of Tehran, Tehran, Iran.

2 Department of Entrepreneurship Development, Faculty of Entrepreneurship, University of Tehran, Tehran, Iran.

3 Department General Psychology, Faculty of Psychology and Educational Sciences, University of Tehran, Tehran, Iran.

4 Department Cognitive Psychology, Faculty of Psychology and Educational Sciences, University of Tehran, Tehran, Iran.

Abstract

Research Objective: The primary objective of this study was to explore the influence of monetary rewards on the formation and evaluation of innovative ideas in entrepreneurial environments. Guided by the “Creativity Cliff Illusion Hypothesis” and “Bounded Ideation Theory,” this research examined the interplay between the quantity and quality of new venture ideas and investigated how various reward structures affect employees’ creative performance.

Research Method: A total of 168 employees from the information and communication technology sector participated in an experimental study testing three distinct reward models: maximum, random, and no reward. The analysis involved applying a Spearman correlation test to assess the relationship between idea quality and quantity, and a Generalized Additive Mixed-Model Analysis was used to evaluate overall idea generation performance.

Findings: The study found that monetary rewards significantly enhance both the number and quality of ideas, whereas their absence leads to reduced creativity. Moreover, the relationship between idea quantity and quality follows an inverted U-shaped pattern: quality improves with increased quantity until a point, then declines. Random rewards produced the strongest impact on originality, freshness, and potential economic value.

Conclusion: These findings clearly suggest organizations adopt flexible reward schemes to sustain ongoing innovation and effectively prevent further decline.

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Main Subjects

Organizational Culture Management

Articles in Press, Accepted Manuscript
Available Online from 18 August 2025

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