I came across a short seminar about how businesses can motivate employees. As a parent, I can see some similarities between a business and a family.
http://www.youtube.com/watch?v=rrkrvAUbU9Y
He gave many examples of how rewards offered to try to increase productivity actually decreased productivity when creative solutions were needed. They did help, in mechanical straight forward solutions.
My favorite parenting book & method is "love and logic" - where you make sure your kids feel loved & empathized by you, but also make sure they learn from the natural or logical consequences. Instead of lectures, consequences (like taking away priviledges) are the discipline.
"If you want to build a ship, don't drum up people together to collect wood and don't assign them tasks and work, but rather teach them to long for the sea." - Antoine de Saint
How, as parents, can we inspire this intrinsic motivation in our children?