Exchange theory is a general
theory concemed with understanding the exchange of

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material or non material
resources between individuals and/or groups in an interaction

situation. Social exchange
theory has been derived from the work of sociologists Homans

(1958), Blau (1964), and
Emerson ( 1972% 1972b). Homans’ explanation of exchange

theory is grounded in operant
psychology as developed by Skinner (1953). In Homans’

view, exchange between
individuals continues because each fin& the others behavior

reinforcing to some degree.
The behavior might consist of a compliment. an expression of

agreement, or assistance in
perfomiing some task of mutuai interest. Two variables have

been derived from the basic
propositions inherent in Homans’  work.
The first involves the

frequency of rewards or
costs, and the second lwks at the value attached to rewards

(Chadwick-Jones, 1976).

Some social exchange behavion
entail “costs” w hile others are essentially cost- free.

For example, a compliment (e.
g. a flattering remark on the choice of an individual’s attire)

may be relatively Iow in cost
to the individual receiving it. Other behaviors, however, may

produce a substantial cost.
For exarnple, two individuals may choose to play a game. This

behavior may be thought of as
social exchange. Assuming that both individuals receive

pleasure from playing, each
individual is rewarding the other simply by playing. However,

for one of the players, the
loser of the game, a cost is incurred. If, over a number of

repeated matches, the same
player continued to lose. the cost of losing may become too

great and that player may
decide to stop playing.

Homans relates cost to the
value of the reward obtainable, acknowledging that value

is diffïcult to measure
because there may be fluctuations in value over time for any

individixl. Homs’ work is
based on the assumption that the basic principles of human

behavior can best be studied
and denved fiom an examination of srnall groups of

individuals and the interpersonal
relations among group members.

Emerson’s (1972a, 1972b)
approach focused on the exchange relation as the most

elementary unit of analysis
rather than the behavior or action. Emerson took hypotheses

from operant psychology and
applied these to human social Ieaming, specifically their

application to individuals.
He presented a more general theoretical framework for analyzing

social interactions,
atternpting to Link individuais involved in social exchange relations

together to form structures
or networks. Much of this work was based on an earlier work

(Emerson, 19621, in which
Emerson examined balance, dependence, and power in the

context of dyadic relations.
Cook ( 1987) summarized Emerson’s notions of balance,

dependence, and power as

“Exchange relations are
‘balanced’  if the two actors involved in
exchange are

equaLly dependent upon one
another; otherwise an imbalance exists in the relation.

Dependence . .  . is determined by the value one actor places
on the resources

provided by the other actor
and the availability of these valued resources from

alternative sources. Unequal
dependencies result in an imbalanced exchange relation

that, according to
power-dependence principles, creates a power advantage for the

less dependent member of the
relation. A power advantage gives an actor the

structural opportunity to use
the potential power that results from the differential

dependencies” (p. 2 16).

Emerson’s analysis begins
with an already estabfished exchange relation. This relationship

is subject to two basic
processes: (1) the use of power and (2) balance. If it is revealed that

within an exchange relation
one individual (A) is highly dependent on another (B), then

individual B would be said to
have apower advantage over individual A. In Emerson’s

view a power advantage
represents an imbalanced exchange relation w hich, over time,

tends toward balance. These
balancing operations can take four forms. Jacobs (1970)

summarized them as follows:

“1.  Reducing the motivationai depndency of the
less powerful member on the

more powerfid one.

2. A power irnbalance can be
reduced by fmding an altemate source of satisfaction

of a need that cannot be

3. A frequently occurring way
to reduce power imbalance is by obtaining control

over some source of
satisfaction required by the more powerful member.

4. A linal balancing
operation consists of developing a source of satisfaction on

which the more powerfd member
can be induced to become dependent, which then

provides a means of reducing
the unequal exchange that is thought to produce

power imbalances” (pp. 2
18- 19).

Recent develo~ments:  The work of Blau.

Blau (1987) credits both
Homans (1958) and Emerson (1962) as having influenced

his conception of social
exchange. Blau (1964) argued that it is possible to understand

social structure and events
that occur within social structures by looking fmt at individual

processes that occur between
people and then building on them. His theory of social

exchange attempts to do just
that. Blau’s theory combines principles from operant

psychology and econornics to
provide a conceptual framework for the analysis of social

relations. Blau maintains
that individuais WU enter into and maintain a relationship as Long

as they can satisfj their
self-interests and at the same tirne ensure that the benefits outweigh

the costs. An individual will
seek to maximize his or her profits (positive reinforcements,

rewards) and minimize Iosses
(negative reinforcements, costs) in interactions with others.

In terms of continuhg
relationships. individuals will try to maintain those exchanges which

have proven to be rewarding
in the past, to break off those which proved to be more costly

than rewarding, and to
establish new relations which have a good chance of king more

rew arciing than costl y.

If there is to be exchange,
there must be “thhgs” exchanged. Yet, exchange is not

solely Limited to the economic
market. Blau suggested that “neighbors exchange favors;

chiidren toys; coiieagues,
assistance; acquaintances, courtesies; politicians, concessions;

discussants, ideas” (p.
88). Individuals have many social resources of various sorts

including expertise (which
makes one valuable as a colleague in a working relationship),

physical beauty or prowess
(which is inainsically attractive to others), or a relationship

with some sociaily desirable
or prestigious group. By caiculating the value of various

resources to individuals in a
group, it may be possible to predicr how they will interact-

Many of the intangible
exchanges are readily recognized by those involved. In Our daily

life, we constantly encounter
situations where we are giving favor and assistance in return

for somethhg else received in
the past, or in anticipation of receiving something else in the

future. Individuals often
speak of “owing” another a letter, or of being “indebted”

someone for help received. It
is probably safe to assume that in our society some son of

reciprocal principle is
operathg and that for every individual some of his or her behavior is

governed by such a principle.
Blau included within the category of social exchange al1

“actions that are
contingent on rewarding reactions from othen and that cease when these

expected reactions are not
forthcorning” (p. 6). In other words, any behavior that is

motivated by an expected
return or response fiom another fails under the heading of


A basic assumption that
differentiates social exchange from purely economic

exchange has to do with
trust. A snidy by Wilson and Kahn (1975) found that subjects

volunteered more tirne to
help in a research project when high rather than when low

monetary reimbursement was
offered. Blau (1964) stated that such arrangements fa11 within

the domain of purely economic
exchange. In economic exchange, payment is in set units,

with arnounts usually fuced
beforehand. Payment is immediate. The conclusion of the

exchange fonnally marks the
end of the relationship between buyer and seller. In social

exchange, on the other hanci,
there is usuaily no fixed understanding beforehand about the

rate at which social
resources wiil be exchanged, or about the length of tùne over which

repayment will be made.
Exchange as a social process “. . . entails supplying benefits that

create diffuse future
obligations. . . and the nature of the rem cannot be bargained about

but must be left to the
discretion of the one who makes it” (p. 93). Social exchange may

involve intrinsic benefits in
which, rather than the acts themselves, it rnay be an underlying

mutual support or fnendliness
that is king exchanged. For example, an individual seeking

advice may be confiirming the
fiiendly relations between him or herself and another.

Another example is when a
couple is invited over to their fiend’s house for dinner. The

two couples typically do rrot
sit down in advance to decide the date for repayment of the

debt. The relationship is one
founded on trust; trust that eventuaily, at some point in the

fuhre, the couple will

Blau (1964) argued that
social exchmges, such as the ones described above,

require that individuals
trust each other. Assuming that individuals wül in fact reciprocate

for gifts they have received,
social exchange will generate feelings of gratitude and trust.

The trust wiii aUow the
individuais within the relationship to establish a bond of solidarity

between them. If there is no
trust, then neither is there social exchange. Furthemore, Blau

called attention to the fact
that distrust will have a negative impact on social behavior in

generai. He suggested that
trust tends to build up gradudly through cornmitment to a

relationship in which there
is f~e  communication between those
individuals involved.


A basic assumption of
exchange theory is the reciprocal relationship. Gouldner

(1960) proposed that
reciprocity is a universal dimension of social relationships. He

suggested that reciprocity
can be broken dom into two central elements;

1. people should help those
people that helped them; and,

2. people should not injure
those people who have helped them.

Here Gouldner is making the
assumption that for most participants of a culture, under most

circumstances, to reciprocate
is cornpulsory; society has successfuily indoctrinated this

norm in most of its members.
The reason individuals recipmcate is due to the

intemalkation of this moral nom
There is an expectation that when one receives

something of value one retums
the benefit to the individual from whom one received it.

Thus, inherent in the
exchange process. is a principle of reciprocity. Over the, a social

“nom of
reciprocity,” whose violation brings about social disapproval and other

sanctions, emerges in
exchange relations. Gouldner suggests that the norm of reciprocity

operates as a starting
mechanism for new social relationships because people are willing to

begin by helping othea howing
that help will eventually be renimed.

This does not mean, however,
that reciprocity is without conditions; it is dependent

on the perceived value of the
benefit received or given. Blau (1964) furthered the notion of

reciprocity by explabhg it in
terms of two principles. Turner (1986) descnbed these

principles as:

” 1.  The more people have exchanged rewards with
one another, the more likely

are reciprocal obligations to
emerge and guide subsequent exchanges among those persons;


2.  The more reciprocal obligations of an
exchange relationship are violated. the

more are deprived parties
disposed to sanction negatively those violating the norm of

reciprocity (264)  .”

Searle ( 1989) argued that
“these p~ciples  provided a clear
rneans by which to

understand the effects of
reciprocity in organizationd relationships (354).” Searle’s

research on the reciprocity
between municipal recreation directors and their recreation

advisory boards was based on
the conclusion from the literature that such relationships

were characterized by mutudy
satisQing exchange.

Blau (1964) also includes a
concept of power in the norm of reciprocity. An

individuai who helps another
obiigates him or ber to reciprocate and thus acquires power

over him or her. The latter
is obliged to accede to the former’s requests, and until this

recipmcation place there is an imbalance of power. Within
power relations the

dependence tends to be
one-sided: mutual innuence or interdependence would, in fact,

indicate a lack of power.
Anyone who can supply services which are in high demand fin&

him or herseIf in a position
of power with others who are dependent on him or her for

those services and they may
subsequently be obliged to comply with his or her wishes.

AlI exchange operates under
the presumption that people who give rewards will

receive rewards in tum as
payment. Individuals atternpt to impress each other by revealing

the rewards that they have to
offer in an effort to influence othen, in accordance with the

nom of reciprocity, to
reciprocate with an even more valuable reward. At some point in

tirne, however. it becomes
clear that some people have more valued resources to offer than

others, putting them in a
unique position to extract rewards from all others who value the

resources that they have to

BIau (1964) illustrates the
asymmetry of many relationships where one person is

more dependent on another.
The fmt person has less resources, or fewer alternatives than

the second, may have less
infiuence and therefore must comply with the wishes of the

second person. The balance of
reciprocity in the relationship is brought into question.

There may be greater costs
involved for the person who has to defer to others, yet if the

resources of the others are
so much greater, then the asymmetry of such an exchange may

be considered equitable by
the less powemil. Differences in power inevitably create the

potential for confiict. Blau
States that authority, “rests on the comrnon noms in a

collectivity of subordinates
that constrain its individual members to conform to the orders

of a superior” (p. 208).
Although it is quite possible for individuals to arrive at a consensus

in the course of the exchange
process itself, an initial set of common values facilitates the

legitimization of power. They
can then enter into exchanges with a common definition of

the situation. Without
comrnon values, the cornpetition for power may be severe. In the

absence of guidelines about
reciprocity and fair exchange, considerable strah and tension

could persist. Jacobs (1970)
suggests that one general way of reducing power imbalance

involves the tendency of the
less powerful rnember to increase the distance between

themselves and the more
powemil individual. This tendency is ~flected 

through reduced interaction.
Blau (1964) concludes that there wili be a general tendency for

interactions to decrease as
the power differential between two persons increases. Jacobs

argues that this conclusion
must be tempered by the question of how the more powerful

individual reacts to an
interaction initiation by a Iess powerfd person. If he consistent1 y

reacts in an accepting and
rewarding manner, the atternpts at interaction should increase.

A related, but more recent
concept, is interdependence (Condeluci, 199 1; Covey,

1989). The term, quite
simply, implies an interrelationship. Covey States:

“Independent thinking
alone is not suited to interdependent reality. Independent

people who do not have the
maturity to think and act interdependently may be good

individual producers, but
they won? be good leaders or team players. They’re not

coming fmm the paradigm of
interdependence necessary to succeed in marriage,

famiiy, or organizational
reality. Life is, by nature highly interdependent. To try to

achieve maximum effectiveness
through independence is iike trying to play tennis

with a golf club – the tool
is not suited to the reality .”

Although Covey’s (1989)
perspective on interdependence is concemed with relations

between individuals, it is
relevant to relationships within organizations. Condeluci (199 1)

notes that a state of
interdependence between individuals is conducive to facilitating

Interdependence focuses on relationships that lead to a mutual acceptance and

respect between uidividuals.
It promotes an acceptance and empowerment for dl.

Condeluci’s (199 1) work
looks at the interdependent paradigm as it relates to individuals

with disabilities. He argues
that the major problem experienced in an interdependent

paradigm is anitudinal; that
it is not people who are problems, but the Limited viewpoinü of

others. This perspective,
too, can be applied to the relationship between parents and

teachers. If the problern of
the interdependent paradigm rats with limited supports and

attitudinal bacriers, then
the mot of the problem is found in the system. We need to change

and extend the educational
system to accept and welcome parents. An interdependent

approach sees the challenge
resting both with parents and teachea. An interdependent

paradigm would ailow for and
encourage empowement for aii.

Condeluci’s notion of
interdependence is closely tied to the concept of reciprocity,

which is one of the elements
of social exchange theory. Gouldner (1960) has observed that

the two cenaal elements of
reciprocity are that people should help those that help hem and

that people should not injure
those who have helped them. He argues that reciprocity is a

universal nom. In order for
interdependence to exist. then, there must be reciprocity, or

“give and take”,
within the relationship. This means that interdependence can and does

exist between individuals if
both conaibute to the relationship by giving and receiving.