I found this while digging around the archives of the Harvard Business Review Working Knowledge archives: Time Pressure and Creativity: Why Time is Not on Your Side. The editor interviews Harvard Business School professor Teresa Amabile, who at the time was in the midst of a ten-year study looking at creativity in a corporate setting.
Amabile notes, “Some people are convinced that time pressure stimulates creative thinking, and others are certain it stifles creative thinking.”
She later explains that time pressure is one of many conditions that may have a positive or negative effect. “…the results suggest that, overall, very high levels of time pressure should be avoided if you want to foster creativity on a consistent basis. However, if a time crunch is absolutely unavoidable, managers can try to preserve creativity by protecting people from fragmentation of their work and distractions; they should also give people a sense of being “on a mission,” doing something difficult but important. I don’t think, though, that most people can function effectively in that mode for long periods of time without getting burned out. At the other end of the spectrum, very low time pressure might lull people into inaction; under those conditions, top-management encouragement to be creative—to do something radically new—might stimulate creativity. But, frankly, I don’t think there’s much danger of too little time pressure in most organizations I’ve studied.” So some pressure is actually good.
The interview also provides an explanation as to why people think they are being more creative while under time pressure. “while our participants were giving evidence of less creative thinking on time-pressured days, they reported feeling more creative on those days”. Reality v. perception is always interesting.