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In this video, the Incentive Theory is explained, highlighting that a reward, whether tangible or intangible, follows an action to encourage the behavior to be repeated by associating it with positive meaning. Key examples include workplace promotions as incentives for good performance, the pursuit of a Super Bowl win for NFL players, and scholarships for high-achieving students. The video emphasizes that the immediacy of the reward significantly influences behavior reinforcement, underscoring the importance of positive associations with actions to foster motivation and repeated engagement.