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Social Exchange Theory

Social Exchange Theory


The Social Exchange Framework was formally advanced in the late 1950s and early 1960s in the work of the sociologists George Homans (1961) and Peter Blau (1964) and the work of social psychologists John Thibaut and Harold Kelley (1959). Over the years, several exchange perspectives, rather than one distinct exchange theory, have evolved. The exchange framework is built upon the combination of the central tenets of behaviorism and elementary economics where human behavior is envisaged as a function of its payoff. The framework is primarily concerned with the factors that mediate the formation, maintenance, and breakdown of exchange relationships and the dynamics within them.


Core Assumptions Made Within the Exchange Framework

Embedded within the exchange framework are core assumptions about the nature of individuals and about the nature of relationships (Sabatelli and Shehan 1993). These are summarized as follows:

  1. Individuals seek rewards and avoid punishments.
  2. When interacting with others, individuals seek to maximize profits for themselves while minimizing costs. Because it is not possible to know the actual rewards and costs involved in interacting with another before interactions occur, individuals guide their behavior through their expectations for rewards and costs.
  3. Individuals are rational beings and, within the limitations of the information that they possess, they calculate rewards and costs and consider alternatives before acting.
  4. The standards that individuals use to evaluate rewards and costs differ from person to person and can vary over time.

The assumptions about the nature of exchange relationships are as follows:

  1. Social exchanges are characterized by inter-dependence, that is, the ability to obtain profits in a relationship is contingent on the ability to provide others with rewards.
  2. Social exchanges are regulated by norms like reciprocity, justice, and fairness.
  3. Trust and commitment result from the emergent experiences of individuals within relationships and help to stabilize relationships over the longer term.
  4. The dynamics of interaction with relationships and the stability of relationships over time result from the contrasting levels of attraction and dependence experienced by the participants in the relationship.

Major Contemporary Concepts

The major exchange concepts can be classified as falling into the following broad categories:

Rewards, costs, and resources. Exchange theories make use of the concepts of rewards and costs (which were borrowed from behavioral psychology) and resources (which were borrowed from economics) when discussing the foundation of the interpersonal exchange. Rewards and resources refer to the benefits exchange in social relationships. Rewards are defined as the pleasures, satisfactions, and gratifications a person enjoys from participating in a relationship (Thibaut and Kelley 1959). Resources, on the other hand, are any commodities, material or symbolic, that can be transmitted through interpersonal behavior (Foa and Foa 1980) and give one person the capacity to reward another (Emerson 1976). The costs of social exchange relationships can involve punishments experienced, the energy invested in a relationship, or rewards foregone as a result of engaging in one behavior or course of action rather than another (Blau 1964).Satisfaction with exchange relationships: outcomes and comparison levels. Satisfaction with an exchange relationship is derived, in part, from the evaluation of the outcomes available in a relationship. Outcomes are equal to the rewards obtained from a relationship minus the costs incurred. Although it is generally the case that the higher the level of outcomes available, the greater the satisfaction, these concepts are not equivalent. To account for satisfaction, both the experiences of the outcomes derived from the relationship and the expectations that individuals bring to their relationships are taken into account (Nye 1979; Sabatelli 1984; Thibaut and Kelley 1959).

The concept of Comparison Level (CL) was developed by Thibaut and Kelley to explain the contributions that previous experiences and expectations make to the determination of how satisfied an individual is with a relationship. Individuals come to their relationships with an awareness of societal norms for relationships and a backlog of experiences. The CL is influenced by this information and, thus, reflects (a) what individuals feel is deserved and realistically obtainable within relationships, and (b) what individuals feel is important for them to experience within a relationship. When the outcomes derived from a relationship exceed the CL (particularly highly valued outcomes or ones that are important to individuals), global assessments of a relationship are likely to be high (Nye 1979; Sabatelli 1984; Thibaut and Kelley 1959).

Relationship stability: comparison level for alternatives, dependence, and barriers. According to exchange theorists, satisfaction with a relationship alone does not determine the likelihood that a relationship will continue. Thibaut and Kelley (1959) developed the concept of comparison level of alternatives (CLalt), defined as the lowest level of outcome a person will accept from a relationship in light of available alternatives, to explain individuals' decisions to remain in or leave a relationship. The CLalt is an individual's assessment of the outcomes available in an alternative to the present relationship. When the outcomes available in an alternative relationship exceed those available in a relationship, the likelihood increases that person will leave the relationship.

Hence, staying in or leaving a relationship is not simply a matter of how rewarding that relationship is. Relationships that are rewarding are more likely to be stable because a high level of outcomes reduces, in terms of expectations, the likelihood of a better alternative existing. Unsatisfactory relationships, in turn, may remain stable for the lack of a better alternative. These relationships have been conceived of as nonvoluntary relationships by Thibaut and Kelley (1959). Married individuals who stay in violent relationships can be thought of as participating in a nonvoluntary relationship—that is, the relationship stays stable in spite of the violence because of the absence of better alternatives (Gelles 1976).

The CLalt is also related to the experience of dependence. Dependence is defined as the degree to which a person believes that he or she is subject to or reliant on the other for relationship outcome. The degree of dependence evidenced is determined by the degree to which the outcomes derived from a relationship exceed the outcomes perceived to be available from existing alternatives. Dependence may be experienced as one of the costs of participating in a relationship, but this is probably determined in part by the level of satisfaction experienced with the relationship. Dependence, in other words, is tolerated in highly rewarding relationships.

Dependence is further influenced by the barriers that increase the costs of dissolving an existing relationship (Levinger 1982). Levinger proposes the existence of two types of barriers—internal and external—that discourage an individual from leaving a relationship by fostering dependence even if attraction is low. Internal barriers are the feelings of obligation and indebtedness to the partner that contribute to dependence by increasing the psychological costs of terminating the relationship. Internal constraints might involve the moral belief that a marriage, for example, is forever or that children should be raised in a home with both parents present. External barriers are things like community pressures, legal pressures, and material or economic considerations that foster dependence by increasing the social and economic costs of terminating a relationship.


Norms regulating exchange relationships: exchange orientations and rules. Exchange relationships are governed by both normative and cognitive exchange orientations that delineate acceptable and appropriate behavior. Normative orientations refer to the societal views on acceptable and appropriate behavior in relationships. These norms refer to the broader consensus that exists within a culture about how exchange relationships should be structured.

Cognitive orientations represent the beliefs, values, and relationship orientations that an individual associates with various types of exchange relationships (McDonald 1984). These orientations serve as the standards for interpersonal behavior that an individual brings to his or her personal relationships. Among the more prominent of the cognitive orientations discussed in the exchange literature are the norms of distributed justice, or fairness, norms of reciprocity, and norms of equity (Blau 1964; Homans 1961; Walster, Walster, and Berscheid 1978). Each of these has to do with the expectation that within a close and intimate relationship, the rewards experienced by partners should be more or less proportionately distributed. When these norms are violated, as when housework is unfairly distributed within a marriage, people are apt to complain more about the relationship and pressure their partners to restore a more just and fair pattern of exchange (Berardo, Shehan, and Leslie 1987).

Trust and commitment. Trust refers to the belief on the part of individuals that their partners will not exploit or take unfair advantage of them. When relationships conform to the norms of reciprocity and when the pattern of exchange is perceived as being fair, individuals are more likely to come to believe that they will not be exploited (Blau 1964; McDonald 1981). Trust is proposed to be important in relationship development because it allows individuals to be less calculative and to see longer-term outcomes (Scanzoni 1979). Put another way, through trust an individual is able to expect fairness and justice in the long-term and therefore does not have to demand it immediately.

Commitment is characterized as central in distinguishing social and intimate exchanges from economic exchanges (Cook and Emerson 1978). Commitment involves the willingness of individuals to work for the continuation of their relationships (Leik and Leik 1977; Scanzoni 1979). Exchange theorists would expect commitment to develop within a relationship when partners experience high and reciprocal levels of rewards that facilitate the experience of trust (Sabatelli 1999). Commitment builds stability into relationships by increasing partners' dependence on their relationships—in part because the emergence of commitment is thought to be accompanied by a reduction of attention to alternative relationships (Cook and Emerson 1978; Leik and Leik 1977; Scanzoni 1979).

Exchange dynamics. The exchange framework also provides insight into the dynamics found within intimate relationships. In particular, the exchange framework has been used to explain the patterns of power and decision-making found within relationships. Fundamental to the exchange views of power are the assumptions that dependence and power are inversely related, and resources and power are positively and linearly related (Huston 1983; McDonald 1981; Thibaut and Kelley 1959). This is to suggest that exchange theorists address the bases of power by focusing on the constructs of resources and dependence. The partners least interested in their relationships tend to have the greater power in large part because they are less dependent on the relationships. The partners with the greater resources, also, tend to be the ones with the greater power—here largely because they have relatively greater control over the outcomes available to the partners. In other words, the essential point of the discussion of the patterns of interaction observed within exchange relationships is that the relative levels of involvement, dependence, and resources contribute importantly to the different patterns of interaction observed within relationships.


See also:Equity; Family Theory; Filial Responsibility; Intergenerational Relations; Relationship Initiation; Relationship Theories—Self-Other Relationship; Spouse Abuse: Theoretical Explanations; Therapy: Couple Relationships; Trust


Bibliography

Berardo, F. M.; Shehan, C. L.; and Leslie, G. R. (1987). "A Residue of Tradition: Jobs, Careers, and Spouses' Time in Housework." Journal of Marriage and the Family 49:381–390.

Blau, P. M. (1964). Exchange and Power in Social Life. New York: John Wiley & Sons.

Cook, D., and Emerson, R. (1978). "Power and Equity and Commitment in Exchange Networks." American Sociological Review 43:721–739.

Emerson, R. (1976). "Social Exchange Theory." In Annual Review of Sociology, ed. A. Inkeles, J. Colemen, and N. Smelser. Palo Alto, CA: Annual Reviews.

Foa, E. B., and Foa, U. G. (1980). "Resource Theory: Inter-personal Behavior as Social Exchange." In Social Exchange: Advances in Theory and Research, ed. K. J. Gergen, M. S. Greenberg, and R. H. Willis. New York: Plenum Press.

Gelles, R. J. (1976). "Abused Wives: Why Do They Stay?" Journal of Marriage and the Family 38:659–668.


Homans, G. (1961). Social Behavior: Its Elementary Forms. New York: Harcourt, Brace & World.

Huston, T. L. (1983). "Power." In Close Relations, ed. H. H. Kelley, E. Berscheid, A. Christensen, J. H. Harvey, T. Huston, G. Levinger, E. McClintock, I. A. Peplau, and D. R. Peterson. New York: Freeman.

Leik, R., and Leik, S. (1977). "Transition to Interpersonal Commitment." In Behavioral Theory in Sociology, ed. R. Hamblin and J. Kunkel. New Brunswick, NJ: Transaction.

Levinger, G. (1982). "A Social Exchange View on the Dissolution of Pair Relationships." In Family Relations: Rewards and Costs, ed. F. I. Nye. Beverly Hills, CA: Sage.


McDonald, G. G. (1981). "Structural Exchange and Marital Interaction." Journal of Marriage and the Family 43:825–839.

Nye, F. I. (1979). "Choice, Exchange, and the Family." In Contemporary Theories About the Family, ed. W. Burr, R. Hill, F. I. Nye, and I. Reiss. New York: The Free Press.

Sabatelli, R. M. (1984). "The Marital Comparison Level Index: A Measure for Assessing Outcomes Relative to Expectations." Journal of Marriage and the Family 46:651–662.

Sabatelli, R. M. (1999). "Marital Commitment and Family Life Transitions: A Social Exchange Perspective on the Construction and Deconstruction of Intimate Relationships." In Handbook of Interpersonal Commitment and Relationship Stability, ed. W. H. Jones and J. M. Adams. New York: Plenum Press.

Sabatelli, R. M., and Shehan, C. (1993). "Exchange and Resource Theories." In Sourcebook of Family Theories and Methods, ed. P. Boss, W. Doherty, R. LaRossa, W. Schuum, and S. Steinmetz. New York: Plenum Press.

Scanzoni, J. (1979). "Social Exchange and Behavioral Interdependence." In Social Exchange in Developing Relationships, ed. R. Burgess and T. Huston. New York: Academic Press.

Thibaut, J. W., and Kelley, H. H. (1959). The Social Psychology of Groups. New York: John Wiley & Sons.

Walster, E.; Walster, G. W.; and Berscheid, E. (1978). Equity: Theory and Research. Boston, MA: Allyn & Bacon.

RONALD M. SABATELLI>

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Social Exchange Theory

Social Exchange Theory

BIBLIOGRAPHY

While the general study of market exchange is the domain of the discipline of economics, the social, interactional components of exchange (in a market context or not) interest other social scientists. As German sociologist Georg Simmel noted: Exchange is not merely the addition of the two processes of giving and receiving. It is, rather, something new. Exchange constitutes a third process, something that emerges when each of those two processes is simultaneously the cause and the effect of the other ([1907] 1971, p. 57).

Noneconomic investigations of exchange appeared in anthropology in the 1920s. For example, in 1922, Bronislaw Malinowski published a study of islander life that analyzed status components of exchanges that were different from (although related to) simple consumption or material interests. Other anthropological studies followed that emphasized the importance of gift giving and reciprocity for the maintenance of cohesive relationships.

A series of sociological and psychological studies of exchange emerged in the 1950s. George Homans adapted behavioral or operant learning tenets to describe behavior among individuals. Because operant principles emphasize how individuals act on the basis of previous experience, Homanss formulation also focused on the past as predictive of future behavior. He presented human exchanges as involving rewards and costs and argued that people responded to these exchanges so that benefits outweighed costs. Somewhat different from Homanss approach, Peter Blau developed a more economic framework in his exchange formulations. So, for example, in his analysis of bureaucracies, he pointed out that people compete for scarce resources and trade different social commodities (such as advice).

In psychology, John Thibaut and Harold Kelley developed their theories of social power that involved the idea that the amount of power one individual or group possesses is determined, in part, by the alternatives present. Thus, individuals gauged whether to engage in exchanges dependent upon the value of the exchange itself and if alternatives were available. Alternatives also affected the way comparisons among activities were perceived; that is, what was experienced in the past affected how attractive or unattractive a particular option appeared.

Richard Emersons formulation of power-dependence theory in social relations took these previous conceptualizations and developed an overarching theory. It specified a relational aspect to power that placed the exchange relation as central. Power was inversely related to dependence: For a given exchange relation, the more powerful an individual or group, the less dependent on the relation. Further, Emersons theory posited a continual balancing mechanism in exchange relations. If people had power, they used it because it gave them advantage. But, if power was used, it was (incrementally) lost. This shift of power leads to balancing.

Further distinctions in different kinds of exchanges emerged in work that followed. Specifically, Linda Molm distinguished two types of exchanges that had different properties. Negotiated exchange involves bargaining and negotiation and then agreement upon the terms of the exchange. In contrast, reciprocal exchange does not involve negotiation but, instead, is comprised of individual acts performed for an other or others without knowledge about future reciprocation. Given equivalent costs and benefits, reciprocal exchanges generate more trust and affect than do negotiated exchanges. Part of the reason for this is that, at least under some conditions, risk generates trust.

Molm investigated coercive power in these nonnegotiated exchanges as well. Coercive power (in the sense of punishing others) is seen by participants as intentional and most likely to be used when an actor has little reward power. This is probably the case because coercion is risky and can decrease the possibilities of future beneficial exchanges. So, even though punishment can be an effective strategy if it is consistently and contingently applied, actors do so relatively infrequently.

While there are differences between negotiated and reciprocal exchanges, there are similarities as well. One important similarity rests with the negative emotion that can be generated with power use. For example, the conflict spiral, a theory about bargaining processes, documents that unequal power, even without punishment, can produce negative emotion.

Much of the research on negotiated exchange has focused upon the idea of alternatives to valued resources and so has considered exchange networks. Relative power of positions in simple networks can be analyzed by calculating the alternatives to a given position. Depending upon the number and extent of alternatives within the network, different kinds of relationships can be defined. Particularly important for the exercise of power is the ability to exclude others. The network then can define strong, equal, or weak power. There have been a number of attempts to find methods of predicting power in networks that vary in structure and size. There is the graph theoretic approach, a game theory approach, and an expected value mode, among others.

Emotion is also implicated in the exchange process. The affect theory of social exchange, for example (see, in particular, Lawler 2001), maintains that while social exchange has an instrumental and individual function, the exchange itself involves a group product that fosters emotional, affective processes. While rational choice formulations had examined how commitment in exchange networks was fostered by uncertainty reduction, it has been demonstrated that affect, in and of itself, can also generate commitment. Productive exchanges provide particularly strong arenas for emotion. These exchanges occur in settings in which group members have equal power, coordination issues exist and must be solved, and interdependence of group members is necessary for production of the outcome.

While the study of exchange has always been important to group dynamics, the addition of emotion and notions of risk, trust, and uncertainty has transformed early investigations of simple cost and benefit. The transformations have expanded both the depth and scope of exchange formulations. For example, depth has been transformed by analysis of actors strategies in the face of contingencies, and scope has been transformed by analysis of the network configurations under which exchange occurs. In this regard, different disciplines have contributed different insights to the study of social exchange: game theory in economics has focused upon strategies, anthropology has emphasized the cultural components implied in cohesive groups, psychology has investigated issues related to risk and uncertainty, and sociology has focused upon the network structure under which exchange occurs.

SEE ALSO Blau, Peter M.; Groups; Norms; Reciprocity

BIBLIOGRAPHY

Blau, Peter M. 1964. Exchange and Power in Social Life. New York: Wiley.

Cook, Karen S., and Richard Emerson. 1978. Power, Equity and Commitment in Exchange Networks. American Sociological Review 43: 721739.

Emerson, Richard M. 1972. Exchange Theory, Part I: A Psychological Basis for Social Exchange. In Sociological Theories in Progress, Vol. 2, eds. J. Berger, M. Zelditch Jr., and Bo Anderson, 3857. Boston: Houghton Mifflin.

Homans, George C. 1958. Social Behavior as Exchange. American Journal of Sociology 63: 597606.

Lawler, Edward J. 2001. An Affect Theory of Social Exchange. American Journal of Sociology 107: 321352.

Malinowski, Bronislaw. 1922. Argonauts of the Western Pacific. New York: Dutton.

Molm, Linda D. 1997. Coercive Power in Social Exchange. Cambridge, U.K.: Cambridge University Press.

Molm, Linda D., Nobuyuki Takahashi, and Gretchen Peterson. 2000. Risk and Trust in Social Exchange: An Experimental Test of a Classical Proposition. American Journal of Sociology 105: 13961427.

Simmel, Georg. [1907] 1971. On Individuality and Social Forms, ed. Donald N. Levine. Chicago: University of Chicago Press.

Thibaut, John W., and Harold H. Kelley. 1959. The Social Psychology of Groups. New York: Wiley.

Willer, David, ed. 1999. Network Exchange Theory. Westport, CT: Praeger.

Jane Sell

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