Exchange Theory


One of the paradigms of modern Western sociology is the theory of social exchange, developed most extensively by American sociologist George Homans and Peter Blau. Functioning of the individual and society, according to this theory, is based on the exchange of broadly understood various social benefits and activities. Thanks to this exchange, there are power, prestige, status, procedure, etc. (Rusbult, 1983).

The Theory of Social Exchange

Social exchange theory is a scientific approach based on the concept of social interaction as a process of exchange. Each party should benefit from the actions of other participants, and, in turn, perform actions, which benefit them. The benefits are such as material goods and intangible, symbolic goods - marks of respect, prestige, positive emotions, etc.

People commit acts that are useful to other people, due to the presence of expectations that are stable in response to their actions, in which they will benefit from the actions of others. Confirming expectations in between individual interaction fixes the exchange acts as a behavioral pattern - a "social reflex" that connects to the minds of the individuals identified as stimuli and responses (Bearman, 1997).

Model for researchers using the concept of social exchange is the founders of this trend - the renowned American sociologist George Homans (1910-1989) and Peter Blau (1918-2002). In "Social behavior: its elementary forms" (1961), Homans formulated the five points that explain individual behavior in the desire of maintaining social exchange:

1) The more single actions of the individual receive reward, the more he (she) tends to perform this action;

2) If a stimulus leads to an action that receives reward with a repetition of the stimulus, individual will seek to replicate the appropriate action;

3) The more valuable is the certain result for the individual actions, the more he (she) will seek to make an action aimed at achieving this result;

4) The more the individual received a fee in the past; the less valuable a repetition of such fees will be for him (her);

5) If the individual does not receive the expected reward, he/she will deliberately try to make aggressive action, and the result of this action is more valuable than the remuneration of non-receipt for him/her. If an individual receives compensation in excess of the expected, he (she) will make demonstratively loyal action, and the result of this action will be more valuable.

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As individuals constantly seek to maintain and renew those interactions that create benefits, and avoid unfavorable interactions, it forms a stable connection between the individual and the exchange structure. Exchange structure may develop on the basis of direct bilateral or direct exchange (see Fig. 1a), but also on the basis of indirect, or generalized exchange (see Fig. 1b).

Analysis of the structures in order to clarify the exchange and receive the benefits motivates people to participate in the interaction, as there is a solidarity / cohesion of the social group. Moreover, the dependency relationships can serve as a universal tool for sociological research. For example, the process of learning is supported by the interaction, as it is a direct social exchange. Obvious benefit to students is the information they receive in the classroom, but the teacher benefits in the form of self-affirmation and recognition of his status.

If students do not receive the benefit from their point of view on the information, they avoid interaction with the teacher; they are distracted by extraneous activities, such as talking to each other. The teacher is not able to draw enough attention and respect for themselves, thus, acting "aggressively" and seeking for more audience than the listeners' attention.

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The learning process can be represented as multifaceted, complex interactions that play a significant role, because it is a generalized social exchange. For example, teachers in class impart knowledge and expertise to students; these students attend school, ensuring the funding in the form of fees, and administration of the institution pays teachers from the state budget or fees.

Homans well describes the concept of social exchange and explains the mutually beneficial, balanced exchanges, but Blau in his book "Exchange and Power in Social Life" (1964) describes inequality and relations of power/subordination. Homans consider it as a consequence of asymmetric exchange, which is resulted only by a desire of participants; interaction to obtain benefits from its activities cannot be explained. According to Blau, the relationship of power/subordination appears, when one of the participants taking  part in the exchange possesses the exclusive opportunity to perform the actions that are useful and valuable to the other participants in the exchange. Using their desire to share, "monopoly" states the most favorable conditions for the exchange and can impose their will on those participants who are ready for the additional costs of effort to support their social exchange actions, because their basis is built on the desire of "monopoly". Over time, this unbalanced exchange leads to the development and perpetuate inequality. Moreover, a process of exchange unequal distribution of socially relevant resources, thereby creating a "monopoly", and the interaction of the individual recognition of this situation normally means that the actual interaction is not always the ideal model of social exchange. It is possible to explain the deviation, which can be explained by two reasons. First, the expectation of mutual benefit can be violated without stopping the social exchange, and it is contrary to the basic postulates of the theory of Homans. Second, except for the calculation of personal benefits / cost actions, individuals also receive motivation and social norms that is faith in the wisdom of committing which is disadvantageous to individual actions, if these actions contribute to the preservation of the social order (Blau, 1964).

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Blau analysis is remarkably different from the version of the theory of exchange, which contradicts to Homans’. Individual and individual behavior that matters to Homans are of paramount importance; and the concept of Blau almost does not occupy any significant role. For various social facts, for example, Blau considers groups, organizations, communities, society, norms and values. In his analysis, he draws attention to the relationship and break down of the large-scale social units, which, undoubtedly, are a traditional subject and an adherent paradigm of social facts.

Claiming that he is only a formulator of the theory of exchange, which extends to the level of large communities, Blau, however, goes beyond the recognition. He even had to admit that the processes that are characterized for the given level of their interactions are fundamentally different from those that occur at the individual level. Trying to push the boundaries of exchange theory, Blau transformed it into the macro-level theory, but apparently, scientists were well-aware of the main subject of the theory of interpersonal exchange. Therefore, it needs to be supplemented, while considering macrostructures. Blau does not hide this belief, and his most recent work focuses on the macro-level, structural phenomena (Thibaut, 1959).

Thus, finally, this paper concludes that social exchange theory is extremely beneficial to the sociologists that lead to empirical study of how social communities and social structures are fairly successful, and attempt to constructively integrate different approaches of structural activity featured by the interest, stratification, social and psychological. In the last ninety years, the theory of social exchange has become extremely significant, while analyzing exchange networks, both in theory and empirical research (Kelley, 1978).

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