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Statements like the one presented above can be found in the literature, nevertheless, it is often merely stated that the incentive preferences of individuals differ in different countries. More detailed information on what the employees actually demand as a reward, in other words, which rewards they do find motivating, is often not provided. Especially, empirical evidence on the cross-national differences in motivational effects of performance rewards is seldom presented to back up the assumptions that employees from different countries differ in their perception and appreciation of motivating performance rewards.

Starting from the 1960s researchers have shown great interest in motivation. Along with research in areas such as Human Resource Management and Organizational Behavior employee motivation has become a fascinating research topic also for Management academics. The research focus has been placed on the motivation process of employees as well as on the rewards which individuals find motivating. Further, some research has been conducted on finding out the differences in employee motivation in different countries. The following subsections cover some major motivation theories and their applicability in different countries as well as discuss the existing cross-national studies on employee motivation.

As the research hypotheses are introduced, this chapter will introduce the methods of testing these hypotheses. In the following the research tool, namely a questionnaire survey, which is used to collect the data for the 2003 Country-Specific Incentive Design (CID) study, will be introduced along with the study organization.

Hypothesis 1 asserts that different institutional frameworks generate different individual preferences with respect to performance rewards. The previous chapter provided the method of analyzing the collected data in order to test this particular hypothesis. In the following the results of the data analysis of Hypothesis 1 are presented followed by the analysis of the influence of institutional frameworks on the differences found between the importance of work related goals as well as the rankings of performance motivators and the identifications of non-motivators at the study organization in Germany and the USA.

As Hypothesis 1 was discussed in the previous chapter, this chapter focused on examining and testing Hypothesis 2, which asserts: Rewards generate utility at diminishing marginal rates. In the following, first the study results will be introduced and after that that possible explanations to the results will be discussed relating the arguments to the institutional frameworks.

The previous chapters have discussed the differences in performance reward preferences of German and US employees of the study organization. It was possible to discuss the differences and similarities between the employees in these two-countries as presented in Chapters 4 and 5. In addition to the data collected from Germany and USA data was also collected from the Chinese and Japanese subsidiaries of the study organization. This data was collected during August 2003 using the same questionnaire and the data collection techniques as in the studies performed in Germany and the USA. The translation of the questionnaires was done using the same procedure as the translation of the German questionnaire. The efforts yielded 64 questionnaire responses from China and 65 questionnaires from Japan. The response rates were 91 percent and 92 percent respectively. After the data cleaning process the data set composes of 64 responses from each country. The demographic distribution of the four-country sample, consisting of 640 responses in presented in Table 6-1.

The study has focused on testing one phenomenon known in practice, namely, that employees in different countries are motivated by different rewards (H1). The study presented used the process theories of motivation as a starting point for the research assuming that individuals’ behavior is purposeful and individuals perform tasks as long as they believe that it contributes to their satisfaction, to their utility. The study combined this with the previous research on cross-national differences on employee motivation using the New Institutional Economic theory, especially the notion of institutional frameworks. This allowed pointing out the elements in the individual motivation process, which are influenced by the institutional frameworks. It was also tested if the commonly known economic phenomenon of diminishing marginal utility also applies to performance reward preferences of individuals (H2).