Deci, Koestner, and Ryan (2001) make a point in their article, "Extrinsic Rewards and Intrinsic Motivation in Education: Reconsidered Once Again" that a student's self determination relies a great deal on their motivation. In this article they look at the effects of extrinsic vs. intrinsic motivation when it comes to education.
According to Deci, Koestner, and Ryan (2001) if a student is extrinsically motivated with things such as candy or stickers or other tangible items, then they will only be motivated to do work for those exact things. This shows to have a negative effect on education as students do not have motivation to do their work unless it comes with their tangible reward.
Alternatively, Deci, Koestner, and Ryan (2001) say that a student's intrinsic motivation can be increased with things such as slight praise or attention, if the child responds well to such things, or just basic acknowledgement that they are doing the right thing and doing well. Their study shows that the verbal rewards work positively with intrinsic motivation of students, rather than working negatively.
Deci, Koestner, and Ryan (2001) tie intrinsic and extrinsic motivation back into the self- determination theory by looking at the cognitive evaluation theory which states "that underlying intrinsic motivation are the innate psychological needs for competence and self-determination." (Deci et. al. 2001). A student's self-determination is an important part of their education, and Deci, Koestner, and Ryan (2001) look at the positive and negative effects that rewards have on that self determination for students.
Part of what makes verbal rewards a positive motivator, is it show to increase a student's self-determination, whereas tangible rewards tend to decrease the self determination of a student.