Social Exchange Theory Essay

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Social exchange theory analyzes the nature and internal dynamics of individual acts of exchange as well as explaining the development of social systems emerging from exchange processes. Widely used in the 1960s, it was largely replaced by rational choice and social network theories although the revived interest in Georg Simmel has drawn attention again to social exchange.

The two major, early proponents of a systematically developed theory of social exchange were George Homans (1974) and Peter Blau (1964; 1995) although the concept of social exchange and its impact upon social formations predates them considerably. A sampling of earlier usage demonstrates the interest social exchange has held across time, cultures, and within vastly different social formations.

Aristotle’s Nichomachean Ethics examines various forms of exchange, distinguishing economic -based upon precisely stated terms – from exchanges where A gives something to B as though it is a free gift but there is an underlying understanding/ expectation of some later reciprocation. Most social exchanges are like loans with unspecified but mutually understood terms of gratitude, personal indebtedness, and expectation of repayment. Aristotle’s interest was the breadth of exchange, its unspoken reciprocity and ethical parameters.

Adam Smith’s Wealth of Nations suggested in 1776 that due to humankind’s natural propensity” to truck, barter and exchange, individuals, in the pursuit of their own particular interests, enter the market and, through the extended processes of social exchange, meet their needs and wants. The market’s unseen hand” ensures that everyone’s needs and wants are met and exchange becomes the basis for a larger social dynamic. Smith’s work emphasized how individual exchange created a larger system of exchange – the link to social network theory – and also suggested that people are rational, utility maximizers linking social exchange to rational choice theories.

Simmel’s 1908 work, Soziologie, started from radically individualist premises but through concepts like dyad, triad, and sociation” showed how a macro web of group affiliation emerged through exchange.

Social exchange theory also figured prominently in anthropology. The key works are Bronislaw Malinowski’s 1922 study, Argonauts of the Western Pacific, which demonstrated how the kula exchange structured relationships extending from the interpersonal to alliances among tribes against distant enemies. Marcel Mauss’s 1925, Essai sur le don: Forme et raison de l’echange dans les societies archa’iques (The Gift: Forms and Functions of Exchange in Archaic Societies), explored the power relations of gift exchange as generous gifts pressure the recipient for an equivalent response or suffer losses in prestige, authority, and privilege.

While frequently confined to economic acts, social exchange theorists emphasize that exchange is ubiquitous in social life and ranges, for example, from the sharing of toys, tools and information to secrets, favors, sex, friendship, and love. Exchange presupposes differentiation among individuals through the uneven dispersion of resources that will help meet different needs and wants. Exchange begins through association whereby enough trust exists or develops for A to give something that B finds rewarding creating an unspoken debt” that B will repay at a later time (or remain in A’s debt). Through ongoing exchange, trust may grow and the intrinsic, personal value and nature of the exchange may deepen. Exchange will continue until one party no longer feels rewarded and the desire to continue fades. In social exchange, there is no specific debt or currency involved – a diffuse sense of obligation is created -and the benefits are usually tied to the source of the reward itself. Through exchange, an ongoing pattern of interaction emerges which may begin to form a network of social relations – a social system.

Although social exchange stems from trust and produces friendship bonds it also establishes power relations. A’s power increases proportionate to the extent that each of the following conditions holds: A has a resource (e.g. toy, tool, idea, smile, loving disposition) that B needs or wants; B cannot get that resource elsewhere; B chooses exchange rather than force to receive the resource from A; B’s need or want of the resource is ongoing.

Though broad in scope, social exchange theory does not cover all social action – e.g. eating when hungry, reading, or driving fast do not directly involve exchange.

Bibliography:

  1. Blau, P. M. (1964) Exchange and Power in Social Life. Wiley, New York.
  2. Blau, P. M. (1995) A circuitous path to macrostructural theory. Annual Review of Sociology 21: 1-19.
  3. Homans, G. C. (1974) Social Behavior: Its Elementary Forms, edn. Harcourt, Brace, Jovanovich, New York.

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