The government uses a range of mechanisms to mitigate market failure in the provision of health care in the United Kingdom. Explicit financial incentives are increasingly used within the UK. However, there is some evidence that providing explicit incentives may not have the desired effect on the supply of healthcare as healthcare professionals are intrinsically motivated. This thesis reviews the literature defining and measuring intrinsic motivation in economics. It then presents a developed theoretical model of work motivation among healthcare providers which informs the empirical analysis. This thesis estimates four empirical applications to test the theoretical model of intrinsic motivation. Two applications use the British Quarterly Labour Force Survey data to examine: 1) differences in the motivation structure of employees in caring public sector from employees in other employment sectors, 2) the impact of income and employment sector on intrinsic motivation, and 3) the reason for the high levels of intrinsic motivation for employees in the caring public sector. The other two empirical works explore how the changes of financial incentives under Quality and Outcomes Framework have affected Scottish General Practitioners’ intrinsic motivation. The findings of this thesis have important policy implications. Mainly, they suggest that policy makers should be careful when using financial incentives to motivate healthcare professionals, as the unintended impact on intrinsic motivation may undermine the effectiveness of the policy.