I'm reading a book by Alfie Kohn called Unconditional Parenting. It's great.
The basics of Unconditional Parenting are recognizing that the punishment and reward systems do not work. You punish you child for doing something wrong, when really, you should ask yourself, and them, why they did this in the first place. Were they bored? Trying to get your attention? And with reward, if given out only when the child does something we expect of them, teaches them that is the only time we will love them. This in turn leads to low self image, depression, and your child not being able to make mistakes without thinking they are a bad person. Taking away something they like because they did something we don't approve of is another subject.
I'm not doing the book justice. I do recommend it very highly. It challenges every other parenting book out there, and Alfie really backs up his writing with many studies and lots of proof. I love it.
Best of all, it just makes sense.