The term incentive system refers to a variety of fields, including biology, education, and philosophy.
In organizational psychology, economics and business an incentive system denotes a structure motivating individuals as part of an organization to act in the interest of the organization.
[1] A fundamental requirement of creating a working incentive system for individuals and the organization is understanding human behavior and motivators of human behavior.
They describe particular incentive systems that attract individuals with particular characteristics.
For instance, variable, rather than fixed, compensation tends to attract individuals with higher skill levels and lower control believes (locus of control).