The Impact of Intrinsic and Extrinsic Rewards on Teachers Creativity

The principal objective of the study is to investigate the impact of intrinsic and extrinsic rewards on teachers’ creativity. Teachers’ creativity is used as dependent variable while intrinsic and extrinsic rewards are used as independent variables. The data are collected from 150 respondents through questionnaires. The principal component analysis (PCA) is applied to check the data validity. The reliability analysis is also performed to make the data reliable. Ordinary least square regression method is used to analyze the impact. The study reveals a positive impact of intrinsic rewards on teachers’ creativity. The extrinsic rewards also have positive impact on teachers’ creativity. It is concluded that rewards enhances creativity behavior of employees. The study recommends increasing intrinsic and extrinsic rewards to enhance teachers’ creativity.


Introduction
Creative behavior of employees is considered to be a robust driver of organizational survival, success and performance in short as well as long run situation (Hunter, Bedell andMumford, 2007 andAnderson, Potoenik, andZhou, 2014). This is the need of creativity which influences both academia and industry (Bodla and Naeem, 2014). In order to enhance this creativity, many organizations develop different reward systems to enhance the creative behavior of employees (Edwards, 1989). There has been an extensive debate on the factors explaining creative behavior of employees. An area of creative research attracts considerable interest of research for the impact of intrinsic and extrinsic rewards on creative behavior of employees.
The debate on the association between creativity and rewards is as old as the research on employee creativity behavior itself (Cummings, 1965 andGlucksberg, 1962). There are two important perspectives that are used to describe this association; the behavioral perspective and cognitive perspective. The behavioral perspective represents the extrinsic rewards as a positive supports which enhances creativity (Amabile, 1985 andDeci, Koestner andRyan, 1999). The cognitive perspective represents extrinsic rewards as determinant of creative behavior and intrinsic motivation (Eisenberg, Pierce and Cameron, 1999;Friedman, 2009).

Creativity
Creativity is defined as the usage of original ideas or imaginations to create and innovate something; creativity is an important area of research that is neglected in the business research Guilford (1950). Up to now, the research in creativity witnesses tantamount growth in the efforts of research in order to identify the drivers of creative behavior of employees (Shalley, Zhou, and Oldham, 2004).
During the last five decades, the research on creativity has produced more than ten thousand studies; however, several issues are still there that creativity researchers are facing, these issues even include the definition of creativity and literature reviews on reward creativity relationship (Prabhu, Sutton andSaucer, 2008 andBatey andFurnham, 2006). Defining creativity is a complicated task as creativity is to be defined as a process of thoughts (like divergent thinking), in terms of behavior (like searching new ways for conducting same task) and in terms of final product (like investing in new plants). There are four different approaches through which creativity can be explained (Mooney, 1963): i.
The creativity process ii.
The creative product or creativity output iii. The creative personality or the person who brings creation iv.
The creative environment or the environment about which creation comes On the basis of above approaches, there are number of creativity's definitions identified by Taylor (1988) over the five decades. One of these definitions is considered in this study; creativity is defined in many assorted ways that it has almost ceased to mean anything (Batey and Furnham, 2006). Creativity can also be defined as an outcome in the form of process, product or service which is useful as well as innovative and creative (Amabile 1996 andAmabile, 1983). This definition is frequently used by many researchers (Oldham and Cummings, 1996;Amabile, Conti, Coon, Lazenby and Herron, 1996;Fong, 2006;Gilson andMadjar, 2011and Shalley, Gilson andBlum, 2000).

Intrinsic and Extrinsic Rewards
Intrinsic reward is described as the desire to accomplish an action by itself, to practice pleasure in its performance without expectation of any external reward . Intrinsic reward comes from within the worker (Amabile, Hill, Hennessey, and Tighe, 1994). For those individuals who are intrinsically motivated, a task becomes a reward for them (Lepper, Greene, and Nisbett, 1973).
Contrarily, extrinsic reward is defined as a visible and tangible thing given to an employee or individual on the basis of achievement (Deci and Ryan, 1985). Extrinsic rewards have monetary value like bonus, award, salary hike or public recognition. A relation between extrinsic reward and behavior refers to extrinsic motivation. For intrinsic motivation, there is no interaction between behavior and extrinsic rewards (Cooper and Jayatilaka, 2006).
Explaining shortly, the rewards that promote intrinsic motivation are known as intrinsic rewards, these include enjoyment, satisfaction and a sense of achievement. Alternatively, extrinsic rewards promote extrinsic motivation which includes financial and non-financial rewards like recognition and promotion.

Objectives of the Study
The objective of the study is: i.
To investigate the impact of intrinsic rewards on teachers' creativity. ii.
To quantify the effect of extrinsic rewards on teachers' creativity. iii.
To provide useful guidelines to the policy makers as well as to the future researchers. The remaining paper is organized as follows: section two explains the review of previous literature and development of hypothesis, section three presents the data and research methodology, section four describes the empirical results and discussions, section five provides the conclusion and paper ends with some future direction and limitations.

Literature Review
Balkin, Roussel and Werner (2013) studied the extrinsic rewards and their implications for creativity. They gathered data from 300 respondents through structured questionnaires. They found a direct association between extrinsic rewards and creativity. A significant relationship among low pay intensity, choice over timing, generalized outcomes of pay performance contingent pay, ex-post basis of pay and creativity was also found. Bodla and Naeem (2014) analyzed the mediating impact of creativity on the relationship between rewards motivation and performance of the organizations operating in India. The data from 180 respondents were collected through questionnaires. Performance was used as dependent variable while rewards motivation was used as independent variable. Creativity was used as mediating variable. They suggested that rewards motivations increased creativity which ultimately promoted performance.
Conti, Collins and Picariello (2001) demonstrated the effect of competition on intrinsic rewards and creativity. They observed a positive relationship between competition and intrinsic reward and negative relationship between intrinsic rewards and creativity. They found less creativity in females as compare to males. Males were also found to be more motivated (extrinsic and intrinsic) in the environment of competition than females. De Jesus, Rus, Lens and Imaginario (2013) studied the relationship between creativity and intrinsic rewards motivation. They used creativity as dependent variable and intrinsic rewards as independent variables. 302 questionnaires were filled out to collect the data. They found a positive interaction between intrinsic rewards and creativity. Furthermore, they also identified research design as a moderator between intrinsic rewards and creativity.
Deci, Koestner and Ryan (2001) identified the impact of extrinsic and intrinsic rewards in education sector of United States. The required data were gathered through structured interviews from 508 respondents. They found a negative relationship between monetary rewards and intrinsic motivation and a positive relationship between extrinsic rewards and motivation. They further said that all types of extrinsic rewards declined the intrinsic motivation. Eisenberger and Aselage (2009) investigated the impact of rewards on performance pressure, intrinsic interest and creativity. The structured interviews were conducted from 609 respondents of USA residents. They said that expected reward paid for high performance motivated the worker for higher performance which ultimately increased creativity and interest. Eisenberg and Thompson (2011) observed the association between creative performance, stress, motivation rewards and competition. They found that competition increased motivation, motivation enhanced rewards, rewards increased creativity and creativity enhanced stress.
Friedman (2009) analyzed the impact of rewards on creativity. The data from United States' respondents were gathered through well-structured questionnaires. Creativity was used as dependent variable while extrinsic and intrinsic rewards were used as independent variables. A positive relationship between rewards and creativity was found. It was concluded that extrinsic and intrinsic rewards enhanced creativity with the condition that the rewards were to be paid upon creative performance. Grant and Berry (2011) studied the association among perspective talking, pro-social and intrinsic motivations and creativity. The data were gathered from the Indian respondents through interviews. A positive relationship between intrinsic motivation and creativity was found. Furthermore, it was also found that creativity strengthen the pro-social motivation and enhanced performance. Malik, Butt and Choi (2015) analyzed the relation between creative performance of employees and rewards with the moderating impact of locus of control, importance of rewards and creative self-efficacy. They observed a positive influence of extrinsic rewards on creativity. The relation between extrinsic rewards and creativity was moderated by personal disposition, values and locus of control. Navaresse Yauch Goff and Fonseca (2014) explained the impact of rewards, creativity, and organizational culture on workgroup performance of workers working in United States' organizations. A significant relationship between creative performance and individual creativity was found. They did not find any relationship between rewards and creative behavior of individuals. Wiltermuth and Gino (2013) analyzed whether intrinsic and extrinsic rewards increase motivation. They used rewards as independent variable and motivation and creativity as dependent variables. The study was conducted in the organizations working in India. They concluded that rewards significantly increased motivation and motivation, in turn, enhanced creativity. Roskes, Dreu and Nijstad (2012) analyzed the impact of rewards and motivations on creativity and performance. They collected data from 302 respondents of United States. They found that there was a positive relation between rewards and creativity and rewards and performance. The individuals who avoided motivation were found less motivated than the individual who were highly motivated. Yoon, Sung and Choi (2015) studied the perceptions of employees towards extrinsic and intrinsic rewards for creativity. The survey was conducted on more than seven hundred employees. A significant interaction was found between extrinsic and intrinsic rewards and creativity. They concluded that relationship between rewards and creativity was moderated through importance of rewards. Zhang, Long, Wu and Huang (2015) investigated the creativity of employees related to pay for performance in Chinese context. The data of 107 Chinese respondents were collected through structured questionnaires. They found a positive effect of performance based pay on creativity. It was observed that human resource practices weakened the positive association between performance based pay and creativity.

Development of Hypotheses
On the basis of above literature, the following hypotheses are constructed: H1: There is a positive impact of intrinsic rewards on teachers' creativity. H2: There is a positive impact of extrinsic rewards on teachers' creativity.

Data and Methodology
The study investigates the impact of extrinsic and intrinsic rewards on teachers' creativity. The data are collected from 150 respondents through well-designed questionnaires. The closed-ended questions are used in the questionnaire. All the items used in the questionnaires are adopted from previous researches. The principal component analysis (PCA) is applied to check the data validity. The reliability analysis is performed to make the data reliable. Finally, the ordinary least square method is used to analyze the impact of intrinsic and extrinsic rewards on teachers' creativity.

Variables Description
Two types of variables are used in the study; dependent and independent variables. The description of variables is given below: 3.1.1 Dependent Variable -Teachers Creativity During the last five decades, the research on creativity has produced more than ten thousand studies; however, several issues are still there that creativity researchers are facing, these issues even include the definition of creativity (Prabhu, Sutton andSaucer, 2008 andBatey andFurnham, 2006). Defining creativity is a complicated task as creativity is to be defined as a process of thoughts (like divergent thinking), in terms of behavior (like searching new ways for conducting same task) and in terms of final product (like investing in new plants). 27 Creativity is defined as the usage of original ideas or imaginations to create and innovate something (Guilford, 1950). Creativity is also defined as an outcome in the form of process, product or service which is useful as well as innovative and creative (Amabile 1996 andAmabile, 1983). This definition is frequently used by many researchers (Oldham and Cummings, 1996;Amabile, Conti, Coon, Lazenby and Herron, 1996;Fong, 2006;Gilson andMadjar, 2011and Shalley, Gilson andBlum, 2000). 3.1.2 Independent Variables -Intrinsic and Extrinsic Rewards Intrinsic reward is described as the desire to accomplish an action by itself, to practice pleasure in its performance without expectation of any external reward . Intrinsic reward comes from within the worker (Amabile, Hill, Hennessey, and Tighe, 1994). In contrast, extrinsic reward is defined as a visible and tangible thing given to an employee or individual on the basis of achievement (Deci and Ryan, 1985). Extrinsic rewards have monetary value like bonus, award, salary hike or public recognition. A relation between extrinsic reward and behavior refers to extrinsic motivation (Cooper and Jayatilaka, 2006).

Econometric Model
The following econometric model is used to analyze the impact of intrinsic and extrinsic rewards on teachers' creativity: Teachers Creativity = β0 + β1 (Intrinsic Rewards) + β2 (Extrinsic Rewards) + e

Results and Discussions
This section presents the results of PCA, descriptive statistics, reliability test, correlation analysis and regression analysis. Table 1 shows the demographic information of respondents. A total of 166 questionnaires are distributed to the teachers of both public and private colleges of city Lahore, Pakistan. Respondents return 150 questionnaires with a high response rate of 90%. The demographic information of respondents is presented in Analysis on larger amount of data is very difficult to handle, the study reduces the data from large number of items to smaller number of constructs through factor analysis (principle component analysis). The principle component analysis posits that the value of KMO must exceed 0.6 and the level of significance (Bartlett test) should be less than 0.05. Once these assumptions are fulfilled, the principle component analysis (PCA) reduces data through variance rotation method. PCA gives Eigen values and those constructs are considered principle component whose Eigen values are greater than 1. If only one Eigen value exceeds 1, it means there is only one principle component which shows that all the values are loaded into a single component and all the loading values must exceeds 0.40; here, the data are considered to be valid and it is known as convergent validity. Again, if more than one Eigen values exceed 1, it means that there are more than one principle components, meaning that all the values are loaded in more than one component. In this case, the data have two values; loading values and cross loading values. The larger value of all the components is considered as the loading value while the smaller value is considered as cross loading value. In this situation, loading values should exceed 0.4 and cross loading values should be less than 0.4; here, the data are considered to be valid and is known as discriminate validity. Shortly, when only 1 Eigen value exceeds 1, this is convergent validity and when more than one Eigen values exceeds 1, this is discriminate validity. Table 2 shows the presumptions of PCA, the value of KMO for all components exceeds 0.60 and the significance level of Bartlett's Test of Sphericity is less than 0.05, so the study can go for further analysis. Those components of a construct considered to be a principle component that has an Eigen value greater than 1. Table 3 shows the Eigen value (as well as total variance explained by each Eigen value) of each component. Two components are extracted from the five constructs (salary, performance bonus, career development, development opportunities, employee satisfaction and job performance) of rewards and teacher creativity. Whereas, only one component is extracted from the two constructs (promotion and working conditions). So, discriminate validity is analyzed from those constructs having two components and convergent validity is analyzed from those having one component. Table 4 provides the validities of all the measures used in the instrument. Two constructs of promotion and working conditions have only one Eigen value which is greater than 1. The related items of these two components are loaded only in one component, and all the items have values greater than 0.4. It posits that there exists convergent validity in the data.
All the constructs' items of salary, performance bonus, career development, development opportunities, employee satisfaction, job performance are loaded in two components, all the loaded values exceed 0.4 and all the cross loading values are less than 0.4. There is presence of discriminate validity in the data. The above arguments demonstrate that all the data collected through instruments are valid.
In order to determine the internal consistency (reliability) of the instrument, the reliability test is also applied. Table 5 shows that all the variables have alpha coefficient above 0.70; showing that the instrument is reliable. Salary, performance bonus, promotion, career development, development opportunities, working conditions, employee satisfaction and job performance has alpha coefficient of 0. 78, 0.71, 0.90, 0.82, 0.79, 0.73, 0.70 and 0.74 respectively. Table 6 reports the descriptive statistics outcomes of all the variables used in the study. The mean value of salary is 4.14 ranging from 2 to 4. The average value of performance bonus, promotion, career development, development opportunities, working conditions, employee satisfaction and job performance is 4. 32, 4.21, 4.17, 3.98, 2.18 and 4.97 respectively.
The correlation analysis is used to predict the nature of correlation. Table 7 presents the results of Pearson Correlation Matrix for dependent and independent variables. There is week correlation among all the variables. The highest correlation coefficient (0.45) is in between teacher creativity and extrinsic rewards. It shows that multicollinearity does not affect the data. Table 8 presents the results of regression analysis for the impact of intrinsic and extrinsic rewards on teachers' creativity. There is significant positive (β = 0.0632, p < 0.05) impact of intrinsic rewards on teachers' creativity. The positive coefficient of intrinsic rewards shows that increasing 1% of rewards leads to increase teachers' creativity by 6.3%. The extrinsic rewards also show significant positive (β = 0.0248, p < 0.05) impact on teachers' creativity. One percent increase in extrinsic rewards causes to increase teachers' creativity by 2.4%. The results are consistent with previous studies. (Yoon, Sung and Choi, 2015;Zhang, Long, Wu and Huang, 2015;Malik, Butt and Choi 2015;Bodla and Naeem, 2014;Navaresse Yauch Goff and Fonseca, 2014;Wiltermuth and Gino, 2013;Balkin, Roussel and Werner, 2013;De Jesus, Rus, Lens and Imaginario, 2013;Grant and Berry, 2011;Eisenberg and Thompson, 2011;Eisenberger and Aselage, 2009;Friedman, 2009;Conti, Collins and Picariello, 2001;Deci, Koestner and Ryan, 2001).
Rewards motivations increase teachers' creativity which ultimately promotes performance. Expected reward against high performance motivates the worker for higher performance which ultimately increase creativity and interest (Eisenberg and Thompson, 2011). The teachers should be competent as the competition increases motivation, motivation enhances performance, performance increase rewards, and rewards increase creativity and creativity increase competition , and the cycle begins again from competition. Extrinsic and intrinsic rewards enhance creativity with the condition that the rewards are to be paid upon creative performance.

Conclusions
Creative behavior of employees is considered to be a robust driver of organizational survival, success and performance in short as well as long run situation (Hunter, Bedell andMumford, 2007 andAnderson, Potoenik, andZhou, 2014). This is the need of creativity which influences both academia and industry (Bodla and Naeem, 2014). In order to enhance this creativity, many organizations develop different reward systems to enhance the creative behavior of employees (Edwards, 1989). There has been an extensive debate on the factors explaining creative behavior of employees. An area of creative research attracts considerable interest of research for the impact of intrinsic and extrinsic rewards on creative behavior of employees.
The study, therefore, investigates the impact of extrinsic and intrinsic rewards on teachers' creativity. The data are collected from 150 respondents through well-designed questionnaires. The closed-ended questions are used in the questionnaire. The principal component analysis (PCA) is applied to check the data validity. The reliability analysis is performed to make the data reliable. Finally, the ordinary least square method is used to analyze the impact of intrinsic and extrinsic rewards on teachers' creativity.
There is significant positive impact of intrinsic rewards on teachers' creativity. The positive coefficient of intrinsic rewards shows that increasing 1% of rewards leads to increase teachers' creativity by 6.3%. The extrinsic rewards also show significant positive impact on teachers' creativity. One percent increase in extrinsic rewards causes to increase teachers' creativity by 2.4%. Rewards motivations increase teachers' creativity which ultimately promotes performance. Expected reward against high performance motivates the worker for higher performance which ultimately increase creativity and interest (Eisenberg and Thompson, 2011). The teachers should be competent as the competition increases motivation, motivation enhances performance, performance increase rewards, and rewards increase creativity and creativity increase competition , and the cycle begins again from competition. Extrinsic and intrinsic rewards enhance creativity with the condition that the rewards are to be paid upon creative performance. It is concluded that rewards enhances creativity behavior of employees. The study recommends increasing intrinsic and extrinsic rewards to enhance teachers' creativity.      34 SECTION 2: EXTRINSIC REWARD 1: strongly disagree, 2: disagree, 3: neutral, 4: Agree, 5: strongly agree Sr. Particulars 1 2 3 4 5 SALARY S1 Your organization access your chances of salary improvement periodically S2 Your organization gives you salary equivalent to your job task S3 Your organization gives you salary on time which motivates you to perform better S4 Your organization increases the salary of its employees based on their performance PERFORMANCE BONOUS B1 Your organization provides organization bonus to boost your motivation B2 Your organization recognized your extra effort with bonus B3 Your organization gives bonus on individual performance B4 If you work harder your organization gives more bonus PROMOTION P1 Your organization gives promotion on individual performance P2 You organization gives promotion on experience basis P3 Organization gives promotions only its old employees SECTION 2: INTRINSIC REWARD 1: strongly disagree, 2: disagree, 3: neutral, 4: Agree, 5: strongly agree Sr.

APPENDIX
Particulars 1 2 3 4 5 Career development C1 Employee receive regular development through workshops C2 Your organization will pay for your training C3 Your organization emphasize its employees to seek assistance from professionals C4 The manager supports career development plans Development opportunities D1 Your organization invest in training of employees D2 Your organization dictates strongly on career development D3 Your organization offer you career advancement options D4 If you work harder your organization gives more bonus Working conditions W1 Organization provide better working condition to enhances your performance W2 Organization provides freedom of opinion in decision making W3 Organization working environment is supportive SECTION 4: EMPLOYEE CREATIVITY Sr. Particulars 1 2 3 4 EMPLOYEE SATISFACTION E1 Present pay doesn't give any significant improvement in your living conditions E2 If another job will offer you more salary then you'll left this organization E3 Would you recommend your friend to join this organization E4 Dou you feel your job is secure E5 Salary is a satisfactory in relation to what you do E6 Salary increment is decided on a fair manner JOB PERFORMANCE J1 You are doing only what others wanted you to do J2 You feel pressurized to do the task well J3 You are able to complete the objectives of organizations J4 After performing any task, you felt that you had perform it well J5 Are you willing to Increase work Efforts in Order to Gain Reward J6 Incentives has a positive effect on your job performance "Thank you" for completing this questionnaire and providing valuable information.