The Communication Field Profits from Social Exchange Theory Use

Social Exchange Puts “Communication Theory” in the Black

      Social Exchange Theory grew out of a standard and accepted economical equation: PROFITS = REWARDS - COSTS. Social Exchange theorists kept the two concepts of rewards and costs and labeled Profit to represent relational or interactional outcome. The work of Altman and Taylor (1973), Gouldner (1960), Homans (1950), and Thibaut and Kelley (1959) pioneered the introduction of Social Exchange Theory to the communication field. All make relevant and original contributions to forward the theory.

Homans (1950) and Thibaut and Kelley (1959) examined the formulations of rewards and costs and its consequent effect on relationship formation. Altman and Taylor (1973) took this concept one step further and applied it to relationship development. Gouldner (1960) directly addresses the actual idea of “social exchange” with his introduction of the Norm of Reciprocity (a “law” from which exchange rules are derived). Roloff (1987) utilizes Gouldner’s (1960) “exchange rules” as a foundation from which to create relational (intimate and non-intimate) and interactional axioms of behavior. The significance and relevance to communication that each of these researchers contributed will be discussed in more detail later in the paper.

Social Exchange’s Perspective Roots

Social Exchange Theory falls under what one would label a “Learning Perspective or Theory.” Pavitt (in progress) presents Deutsch and Krauss’ (1965) view that all learning theories hold three assumptions in common: (a) “hedonism” (humans act to gain pleasure or happiness and avoid pain or unhappiness), (b) “associationism” [thoughts are the result of association or linkage (i.e., relations) among ideas or concepts], and (c) “behaviorism” [limits behavior or action to two concepts: (a) “stimulus” (i.e., environmental conditions that can be observed to affect an individual) and (b) “response” (i.e., the behavior that the affected individual performs)].

Social Exchange theorists certainly accept both the ideas of “hedonism” and “associationism,” but the concept of “behaviorism” is only loosely linked. Hedonism addresses a very basic function of human nature, which can be traced back to the philosophical view of “utilitarianism.” This view extends beyond the almost “animalistic” nature suggested by hedonism. Utilitarianism posits that humans seek both to balance their pleasure (i.e., rewards) over their pain (i.e., costs) (analogous to Social Exchange Theory) as well as seek to achieve the most happiness for all (i.e., an equal balance of the most positive outcomes or rewards for both or all individuals in a relationship or group) (analogous to Equity Theory). The utilitarian view was based on how it was believed the human mind, intuitively, worked. This may explain why the results of social exchange-based perspectives seem intuitive (i.e., consistent with one’s “natural” expectations). Of course, with the views of “hedonism,” “utilitarianism,” and consequently Social Exchange Theory comes the basic acceptance of an innate “selfishness” in humans.

The concept of “associationism” plays many roles in Social Exchange Theory. Bear in mind that this is a theory that places much credence on people’s perceptions and these perceptions are based on past, present, and expected future behaviors. Also, those perceptions stem from “ideals” or “prototypes” that individuals store in memory. Another important role of association has to do with interaction or relational reciprocity, which is certainly based on learned or conditioned behaviors. With the above refinement of associationism, social exchange theorists are forced to accept mental constructs (in a cognitive realist or instrumentalist sense). I would argue that Social Exchange Theory must accept these posited constructs as real (i.e., taking a cognitive realist stance) because of the heavy emphasis placed on perceptions and memory. These perceptions, in addition to actualized behavior, are stored in a construct, which must take some structure or form (i.e., a meaningful mental construct).

This type of view of associationism, which also takes into account the ideas of hedonism of the past (i.e., memory) and of the future (i.e., projected expectations) (Allport, 1969), implies a rejection of the strict view of “behaviorism,” which disregards the supposition of “mentalistic” concepts. The only application of social exchange that includes any degree of behaviorism would be Roloff’s (1987) axioms of exchange rules, and even these are modified by perceptions.

Social Exchange as a Theory

Social Exchange Theory’s predictive powers stem from its ability to yield answers concerning relationship development (from initial interaction), maintenance, and dissolution and the corresponding communication that occurs during such situations. Social Exchange Theory predicts on the broad relational level from potential outcomes (measuring rewards and costs) and on the more narrow interaction level from the norm of reciprocity, which yields acceptable rules of exchange. On either level, it is imperative to note that it is an individual’s “global” assessment and corresponding perception of future profits that guides behavior and decisions (Cline, 1989).

First order of business is to provide a denotative function for the reader. I believe that Social Exchange Theory carries implicit concepts under its wings, from which it gains its predictive power. Rewards and costs build the foundation of the theory. Thibaut and Kelley (1959) use rewards to refer to pleasures, satisfactions, or gratifications that one enjoys or the provision of a means whereby a “drive” is deduced or a “need” is fulfilled; they use costs to refer to factors that inhibit or deter the performance of a behavior. Furthermore, Thibaut and Kelley (1959) suggest that the outcomes (relational or interactional) or consequences of each individual in the dyad is dependent on the rewards received and the costs incurred. These three terms specifically, but not exclusively, come into play during relationship determination.

Gouldner’s (1960) “Norm of Reciprocity” seems rooted in the age-old, biblically-based principle, The Golden Rule (“Do unto others as you would have them do unto you”). The fact that Gouldner (1960) does refer to it as a “moral code” supports this notion. Roloff (1987), who bases his work on the Norm of Reciprocity, defines a social exchange “as the transfer or sharing of resources between relational partners” (p. 14). These resources include, but are not limited to, love, status, services, information, goods, and money (Roloff & Campion, 1985). All five of these concepts work together to determine both relational and interactional outcomes.

To truly get a grasp on the Social Exchange Theory phenomenon, one must take into account the many evaluation procedures that different researchers have introduced during its course of existence. With all of the following evaluation concepts, one must keep in mind that some level of interdependence or potential interdependence (i.e., negotiating a relationship) must exist in a dyad (i.e., each interactant or partner is dependent for rewards based on the other’s behavior).

First, and arguable most important, are what Thibaut and Kelley (1959) call comparison levels. They suggest that an individual evaluates his or her current relationship on two levels: (a) Comparison Level (CL) (an individual’s internal standard for evaluating how satisfactory the relationship is or one’s “ideal” relationship – what one feels he or she “deserves”) and (b) Comparison Level for alternatives (CLalt) (an individual contemplates the best available alternative to the current relationship – a measure of dependence on the relationship). Specifically, CLalt is supposed to act as the determinant of one’s decision to remain in or leave a relationship. It follows that individuals judge how satisfied they are with their current relationship by comparing what they have now [i.e., Outcomes (rewards - costs)] to their ideal relationship (CL). However, people will determine by comparing their outcomes to what they believe their next best alternative is (CLalt). As one can see, one could be very dissatisfied with a relationship, yet remain in it.

Rusbult, Drigotas, and Verette (1994) bring an important point to light; they suggest that if CLalt were the sole determining factor to remain or leave a relationship, few would endure due to the “appearance” of appealing alternatives. Accordingly, these researchers introduce new and necessary factors for the social exchange equation. Rusbult et al. (1994) introduce what they call the “Investment Model.” With this model comes a new evaluation level, the Commitment Level, which represents long-term orientation toward a relationship, and includes intentions to remain in the relationship as well as feelings of “attachment” (Rusbult et al., 1994). They also give more precedence to the role that satisfaction level plays in determining whether one will stay or leave a relationship. The Investment Model introduces the concept of what a partner has “invested” in the relationship – these may be tangible (e.g., children, shared material possessions, etc.) or intangible (e.g., time, self-disclosure, etc.). All of these factors, along with CLalt determine one’s commitment to a relationship and consequent decision to maintain or dissolve.

The Investment Model better explains such a question as to why battered wives remain with their abusers. As a matter of fact, it gives a very complete explanation of the situation. First, the wife is unable to make an untainted CLalt decision for she has to include investments in the relationship. One would assume that beatings would influence the women to judge the relationship unsatisfactory. The concept of CLalt is based on perceptions of imaginary relationships (i.e., the ideal relationship) and on unknown relationships [i.e., alternatives (new or no relationship)]. Certainly, a battered woman can perceive a better alternative, no relationship, if nothing else. But how about when one adds investments in the relationship and other associated costs (e.g., perceived dependency on husband or fear of leaving because of what husband might do). Such a relationship has possible severe consequences with the longer the woman remains in the relationship such as: (a) she begins to lower her standards and actually perceives this relationship as her “best” relationship on both comparison levels, (b) the rewards/costs ratio becomes sabotaged (e.g., the woman views not being beaten as a reward – the husband now has very strong manipulative power over her), and (c) a negative self-fulfilling prophecy ensues, because while the woman lowers her CL and CLalt and feels that this is the type of relationship of which she is worthy, she, consequently, lowers her self-esteem.

Finally, another necessary model to address is “Equity Theory” (Adams, 1965; Walster, Walster & Berscheid, 1978), which I believe implicitly lies in the grand scheme of Social Exchange Theory. Equity Theory suggests that participants in a relationship will behave to ensure an equal balance of rewards and costs for both individuals [i.e., they are concerned with fairness in the relationship – no one should have an advantage over the other (i.e., obtain more rewards or sustain more costs)]. I would argue that individuals that act in such a manner simply view the “relationship itself” as a reward and Equity Theory serves as a model to maintain the relationship (i.e., it functions in a way to keep each individual satisfied, and hopefully, through “equality,” above his or her CLalt).

This short overview of all perspectives or theories that draw from Social Exchange Theory concepts seems to reveal a need to incorporate numerous variables for explanation of relationship development, maintenance, and loss. Briefly and simply, Social Exchange Theory suggests that individuals enter and maintain or dissolve relationships based on rewards and costs or potential rewards and costs of a relationship. Different perspectives lend different meanings to what constitute these rewards and costs, and all are valid. Also, individuals weight these rewards and costs according to the different variables introduced in the different perspectives.

Rewards and costs take on new meaning when one considers the different variables inherent in a relationship such as: what each individual considers and values as a relational reward or cost, comparison to “ideal” or other relationships or potential relationships, commitment or investment in the relationship, and the satisfaction from being in the relationship. In order to truly have any predictive power concerning relational outcomes, it seems probable to suggest the combination of all the factors that each of the aforementioned perspectives introduced.

Implications for Communication

Social Exchange Theory’s contentions in regard to communication falls under what Pavitt (in progress) refers to as the “naive view of communication.” Roloff’s (1987) work with social exchange rules and Altman and Taylor’s (1973) work with social penetration demonstrates this acceptance. Social Exchange Theory embraces the interrelationship between “communication” and “relationship” – a communication act exists on a content and relational level. This assertion follows from Roloff’s (1987) axioms, which posit that “communication” (what is said or content) defines the relationship, and consequently, relational characteristics (i.e., the meaning or intimacy level that individuals have assigned to the relationship) influence the nature of the interactions (i.e., how things are said or paralanguage).

Intentionality is implicit in Social Exchange Theory, in that, one chooses to communicate or not and how to communicate based on both (a) social rules and (b) an assessment of the relationship or interaction.

Altman and Taylor (1973) demonstrate “choice” in their Social Penetration Process. This describes the means by which individuals develop a relationship via self-disclosure (i.e., increased intimacy), a process that penetrates another’s “layered, onion skin” personality, but this process only continues by choice of both parties (Social Exchange Theory). Altman and Taylor (1973) graphically represent this “choice process” through an “Interaction-Evaluation-Forecasts-Decision” process of social penetration (Fig. 3-2, p. 35). While Altman and Taylor (1973) address the issue of “choice,” Roloff (1987) addresses the issue of “social rules,” which has implications for the Social Penetration Process.

Gouldner (1960) took the Norm of Reciprocity and applied it to Social Exchange Theory in order to arrive at eight components or rules of exchange (i.e., exchange of resources). Roloff (1987) takes Gouldner’s work further and builds eight hypotheses or axioms, which suggest the nature of exchange as it varies with the level of intimacy. He adds eight more hypotheses or axioms, which suggest the nature of communication in a relationship as it varies with the level of intimacy of a dyad. These set up hypotheses are commendable, in that, not unlike Berger and Calabrese’s (1975) Uncertainty Reduction Theory, Roloff has set up testable axioms (descriptions and predictions of social exchange and communication dependent on the level of intimacy in a relationship). Sunnafrank’s (1986) reformulation of Uncertainty Reduction Theory’s axioms by the inclusion of predicted outcome value certainly was an attempt to incorporate Social Exchange Theory à la Altman and Taylor’s (1973) Social Penetration Process. In this sense, one can see the circular heuristic value of both Social Exchange Theory and Uncertainty Reduction Theory.

Applying Roloff’s (1987) relational and interactional exchange rules to Altman and Taylor’s (1973) social penetration proves useful on two accounts. First, a decision to continue (decrease, stabilize, or increase intimacy) or exit an interaction or relationship on one individual’s behalf will usually elicit the same response from the other. Also, if one does determine to make a change in the relationship/interaction (based on rewards and costs), the other will most likely follow suit. So both examples remain in tact with the Norm of Reciprocity and Social Exchange Theory. Second, this combination reflects a positive correlation between liking and self-disclosure (i.e. liking leads to increased self-disclosure and increased disclosure results from liking). Stated with a Social Exchange Theory flavor, the notions gain new meaning. If relational/interactional outcomes are positive or projected positive, then, the individuals will like each other and the social penetration process will continue (i.e., intimacy increases).

Social Exchange Theory most certainly holds the idea of successful communication, as stated by Pavitt (in progress), in which the receiver’s assigned meaning to a message must match that intended by the sender. Otherwise, the rules of exchange could not be operationalized by the norm of reciprocity.

Again, these rules of exchange deal with resources, which may be tangible (e.g., money, possessions, etc.) but at the very least must be symbolic (e.g., love, status, information, etc.).

The above discussion details the notion that Social Exchange Theory holds values representative of a “common” view of communication. Particularly, communication (in the social exchange sense) holds three criteria. Communication is (a) intentional and (b) symbolic and must be (c) successful. Also, communication is more or less limited to humans with the above assumptions, in addition to the acceptance of memory and mentalistic constructs from which communication decisions are made. However, the basic notions of “hedonism” and “associationism” inherent in Social Exchange Theory span to the animal kingdom.

Social Exchange Theory vs. Other Perspectives

As expressed earlier, Social Exchange Theory rose out of the assumptions of Learning Theory. However, it does not take a strict learning theory stance. Social Exchange Theory most certainly rejects the notion of “behaviorism,” except for its loose link to Roloff’s (1987) social exchange rules.

As stated earlier with its rejection of “behaviorism,” but firm acceptance of “hedonism” and “associationism,” Social Exchange Theory takes a somewhat cognitive approach as well. I would argue that this is a realist rather than instrumentalist approach. While Social Exchange Theory does wish to predict, it also accepts structure in mental concepts with two of its basic assumptions. First, Thibaut and Kelley (1959) present a detailed depiction of the structure of one’s personality. Second, the notion of CLalt inherently contains the idea of schema (an organized structure of the characteristics of one’s “ideal” relationship), similar to Pavitt and Haight’s (1986) Inferential Model.

Certain aspects of Social Exchange Theory present a view of communication which the other perspectives do not directly address, wrongfully so I believe. Social Exchange Theory demonstrates communication, particularly in initial interactions, as a negotiation process, which the other perspectives, except for Conventionalism do not handle. While similar to rules theories in that communication rules provide (a) a description of the circumstances in which a rule is applicable and (b) whether the behavior or action is required, recommended, or permitted (Pavitt, in progress), Social Exchange Theory gives more insight into why the rule will be obeyed. Rules theories predict behavior, but do not explain why it occurs as Social Exchange Theory does through the rewards/costs ratio. However, Social exchange theorists, particularly Roloff (1987) and his rules of exchange, owe some debt to Conventionalism.

Accordingly, one can easily see that Social Exchange Theory has ties in Cognitive Realism and Conventionalism. However, Social Exchange is more explanatory than Conventionalism and provides more predictive power than Cognitive Realism.

One can see that Social Exchange Theory concepts have been borrowed by Berger (1988) in his Planning Theory, in which plans are constructed for goal attainment. However, this theory spans beyond the “communication event.” In addition, Berger and Calabrese’s (1975) Uncertainty Reduction Theory, which attempted to describe the nature of initial interactions through axioms must have wished to expand and describe more uniformly Altman and Taylor’s (1973) Social Penetration Process. Sunnafrank (1986) realized Uncertainty Reduction Theory’s shortcomings and tried to alleviate them by adding a coloring of Social Exchange Theory to the axioms.

Systems Theory and Information Theory simply do not address issues that are at the core of Social Exchange Theory. Systems Theory relies on observations and watches for patterns of behavior in communication in an interaction or relationship (Pavitt, in progress). Social Exchange Theory accepts these patterns of behavior as self-evident through the social exchange rules.

Similarly, Information Theory concentrates on the accuracy with which a message at its intended destination approximates that of the source (Pavitt, in progress). Social Exchange Theory views the transmission of correctly interpreted information as a given.

From the above discussion, Social Exchange Theory can be judged as having great strengths as well as some shortcomings.

Social Exchange Theory certainly has heuristic value, in that, it has spawned much research overflowing into related perspectives. I feel this is because Social Exchange Theory has grounding on a basic human motivator, that of, selfishness. Selfishness plays a role in relationships to one degree or another (whether it be friendship, family, or teacher-student); there is a rewards/costs motivator at the root of one’s decision. The selfishness may simply reside in nurturing or maintaining the relationship – the concept of “dialectic” [a back and forth struggle over certain contradictory elements (e.g., autonomy vs. connection), which define a relationship] (analogous to Equity Theory).

Social Exchange Theory most definitely has a broad scope. It applies to and can explain a variety of interactions and relationships.

It also is quite simplistic when broken down to its basic framework, that of the economic equation of: Profits = Rewards - Costs. Of course, the many elements that have been added to this equation is what truly makes it useful and generalizable to the real world. Nonetheless, its parsimony is a plus, which allows the theory to expand to other areas.

The theoretical criteria downfall (but what I will argue is necessary) of Social Exchange Theory is its inability to be falsified. The theory rests all its conclusion, assumptions, and predictions on people’s perceptions. Since all people have different perceptions, their view of rewards and costs differs from other’s, and consequently, from any observer’s. With this heavy reliance on perception, the theory can never be “wrong,” unless one can get at the “true perceptions” of others (i.e., mentalistic constructs). However, this leaves a lot of open room for attempting to generalize what it is that people find rewarding or punishing or costly.

The problem lies in the fact that rewards and costs, as well as the norm of reciprocity, are cast at such a high level of abstraction that it does not predict precise behaviors. In this case, Social Exchange Theory is a much better “explainer” and “describer” of outcomes than a precise predictor. Although prediction is quite possible if one knows what it is that another values and detests (with regard to relationships and interactions). This, however, is not usually the case, so it is necessary to work backwards from outcomes or consequences to causes in order to gain any reasonable predictive power.

Applications of Social Exchange Theory

The previous discussion of Social Exchange Theory’s perceptive prowess is the source of its criticisms. However, in regard to what this theory studies (i.e., relationship development, maintenance, or dissolution), any approach that attempted to disregard perception would certainly not be generalizable or useful in actual real world relationship explanation.

Social Exchange Theory has certainly taken the correct stance in assuming humans to be selfish. Whether all humans are truly selfish or not is not the point, because when it comes to relationship formation, this is certainly the case. Social Exchange Theory’s most important utility to communication, and consequently, the most studied area, is in regard to aspects of relationships and the communication within them. I believe that, specifically, it should focus on friendship and romantic relationships (in these days, with the high divorce rate, one can easily include marriages), for these are without a question formed on the participant’s own terms. Unlike, job relations or family connections, there is no “politeness feeling” or internal or external forces pulling the relationship together.

Social Exchange Theory proves powerful in its ease of adaptation across different contexts and situations in reference to relationships. Of particular interest to me is utilizing the theory to determine or explain outcomes of romantic relationships and marriages. I believe that two previously discussed factors of Social Exchange Theory correlate very strongly with each of these relationship types.

Marriages would seem best suited for examination via Rusbult et al.’s Investment Model because partners’ investments can be considered to be relatively high in a marriage. Examining long-term marriages would shed light on exactly how pertinent the concept of “commitment” is to marriage. In testing this, the only method one would have available to reach perceptions of people would be to issue self-reports.

I think that a researcher would find the following in continuing marriages (including abusive marriages). Marriages with a high satisfaction level, regardless of quality of alternatives, would indicate a low or moderate investment size. Marriages with a low satisfaction level, regardless of quality of alternatives, would indicate a high investment size. In other words, I am positing that in marriages, satisfaction level and investment size are negatively correlated. I believe that couples that are truly satisfied will not feel that they are held in the marriage by any other forces than their desire to be together. While they may really have a lot invested in the relationship, I do not believe they will perceive that their investments are playing a significant role in holding the marriage together; thus, they will follow suit when completing their self-report.

The importance of this study would be to demonstrate that a couple’s investment size can significantly override one’s satisfaction in the marriage. If supported, the next logical step would be to study recent divorcees who profess that they had a large investment in the marriage and then test them to discover whether it was low satisfaction level or high quality of alternatives that caused them to exit the marriage. I would hypothesize that the partners would indicate extreme low levels of satisfaction, no matter who initiated the divorce, and that this extended low satisfaction would determine divorce (the last straw to bread the camel’s back syndrome) and not so much the quality of alternatives. In other words, I feel that satisfaction level and investment size are the best predictors of whether a couple will continue or dissolve a marriage.

Conversely, in romantic relationships, I believe one can predict whether individuals will leave or stay in the relationship better through comparison level for alternatives solely, just as Thibaut and Kelley (1959) assumed. Building a romantic relationship with another involves low levels of commitment and easy access to leave the relationship. Granted there may be investments in the relationship; however, they are probably not as significant as a married couple (unless the romantic couple is living together, but even in this case, overall, there is probably less investments).

I would suppose that in a romantic relationship if one’s CLalt exceeds their current relationship, he or she, as Thibaut and Kelley (1959) suggest, will leave the relationship. I would argue that those individuals who claim that they would not leave a relationship so quickly because they feel they should give the other a chance, are simply unsure of their CLalt (i.e., they realize the relationship is not “good,” but their uncertainty and fear of potential alternatives causes them to remain in the current relationship).

This type of study, similar to the marriage study, would need to be based on self-reports questioning both individuals in romanitic relationships and those who recently broke up. I believe that in continuing relationships, one would find either high satisfaction levels regardless of CLalt or low satisfaction levels and low or uncertain CLalt.

The type of studies I have suggested may be difficult to test due to the fact that it is extremely difficult to get at individuals’ true perceptions, unless they both thoroughly think questions out, as well as answer them with total honesty.

While I certainly believe it necessary to include numerous factors for an individual to list costs and rewards of a relationship, I believe that with the above two described studies, one could at least examine if some variables take precedence across different contexts.

Another very interesting, but probably untestable study, would be to examine “cheating” in marriages and romantic relationships. I realize that this is an unrealistic study, in that, attaining a sample would be near impossible, because anonymity does not cut it with an issue such as this.

However, to amuse myself, I will set up the logistics. I think this would be a relatively easy, if possible, study to conduct. I think one would find a very strong positive correlation between cheating and CLalt. I suppose that, particularly in romantic relationships (without the high levels of investments), but also in marriages, that one would not dare risk cheating on his or her partner if one did not perceive any other available options, but on the flipside, if people felt they had plenty of other “good” options, then, “Wham, Bam, Thank You, Ma’am!” It would be a very interesting, but improbable study.

Social Exchange Theory’s usefulness to the study of relationships is unending. Each relational study done utilizing Social Exchange Theory will certainly posit even more questions, and thus, further research.

A theory such as this that explains relational consequences through partners’ perceptions of rewards and costs of the relationship also describes the interdependence of the relationship. While Social Exchange Theory can explain and predict communication in interactions, it is its attention to relationships in which the theory gains the most respect.

Social Exchange Theory can certainly describe and explain relationship outcomes and on a general level, it can predict. Its predictive power comes more by the way of explaining and describing from outcomes and then attempting to generalize to similar relationships.

While the equation of Social Exchange Theory (Relational Outcomes = Rewards - Costs) is dependent on relational partners’ perceptions of rewards and costs, a theory without relational perceptions would indeed never achieve any real world predictions of relational development, maintenance, and dissolution. Perhaps, I am being a bit bold in that statement, but then Social Exchange Theory would simply state that I am just exercising my hedonistic nature.

Social Exchange Theory use may be based on perceptions, but the Communication Field’s use of Social Exchange Theory is straightforward: Communication’s explanation and description of relationships - Social Exchange Theory = Uselessness.


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