Introduction on the psychological concepts, the dyad and


our daily life, we constantly encounter situations where we are giving favor
and assistance in return for something else received in the past, or in
anticipation of receiving something else in the future, which is easy to understand in that people who give something to others
expect the same (or more) from others, and similarly, those that get something
from others are pressurized to return the same to them. These very popular circumstancess
can be explained in light of social exchange theory (SET). This paper will
first begin with brief history of the SET. Then, I will move on with its basic
content as well as the basic concepts of the SET, which is followed by the
application of this theory as hypothetical framework in various disciplines. Finally,
this essay will end with some examples of the familar situations in my daily
life reflecting the SET along with my comments.

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Brief history

The theory has roots in economics, psychologyand sociology. Going back to the early origin, the
SET has surfaced in the middle of the 21st century. According to Wikipedia, the SET has been derived from the
work of Homans (1958), Thibaut and Kelley
(1959), Blau (1964), and Cook and Emerson (1987). “Social Behavior as Exchange” published in
1958 presents sociologist Homans’ view that exchange between
individuals, tangible or intangible,
continues because each finds the others’ behavior reinforcing to some degree, i.e.
more or less rewarding or costly. Thibaut and Kelley (1959) are recognized for focusing
their studies within the theory on the psychological concepts, the dyad and
small group in “The Social Psychologyof Groups”. Blau (1964) argued that it is possible to understand social
structure and events that occur within social structures by looking first at
individual processes that occur between people and then building on them.
Blau’s theory combines principles from operant psychology and econornics to
provide a conceptual framework for the analysis of social relations. The
approach of Cook and Emerson (1987) focused on the exchange relation as the
most elementary unit of analysis rather than the behavior or action, taking
hypotheses from operant psychology and applied these to human social leaming,
specifically their application to individuals. They presented a more general
theoretical framework for analyzing social interactions, atternpting to link
individuals involved in social exchange relations together to form structures
or networks.

Basic content and

SET is defined in Wikipedia as:

            a social
psychological and sociological
perspective that explains social
change and stability as       a process of
negotiated exchanges between parties. Social exchange theory posits that   human relationships are formed by the use of a subjective cost-benefit
analysis and the        comparison of

(2017) further explained that according to this
theory, people tend to weigh the prospective benefits and risks of social
relationships in order to maximize benefits and minimize costs. In other words,
when we enter a relationship, we are inclined to evaluate the rewards we
are likely to gain and the costs we are willing to pay. If  the rewards
outweigh the risks , we will continue to develop the relationship and vice versa (Liu, Vol?i?, & Gallois, 2015).

interactions and exchanges are perceived in SET as a kind of results-driven
social behavior, in which is the concept of cost and rewards is primary. This
means that the outcome of a particular relationship is assessed by the
comparison between the rewards derived from a relationship and the costs
incurred in that relationship. Rewards refer to “pleasures, satisfactions, and
gratifications the person enjoys” while costs are defined as “any factors that
operate to inhibit or deter the performance of a sequence of behavior” (Thibaut
& Kelley, 1959, p. 12). Or as Liu, Vol?i?,
& Gallois (2015) stated “The rewards of human relationships can
be expressed in the form of satisfaction, happiness, self-esteem, acceptance,
and friendship. The costs may involve money, time, unhappiness,
dissatisfaction, losing face, and frustration.” (p. 230). Basically,
rewards are positive feelings while costs are negative ones. It suggests that
individuals in certain relationships intentionally or unintentionally consider
the balance and measure the disparity between rewards and costs, and then
consequently regulate their own maintenance behaviors used in that
relationship. From the social exchange perspective, rewards and costs are
assessed in an overall rating. The relational outcome value of a particular
relationship could be transcribed into a mathematical equation as follows:
outcome = rewards – costs (Thibaut & Kelley, 1959). More specifically, in
the work by Dainton and Zelley (2005), specified relational rewards are viewed
as pleasant benefits whereas relational costs are supposed as unpleasant
drawbacks; therefore, individuals obtain positive outcome value when the
rewards outweigh the cost and vice versa. 

to Social Work Degree Guide (n.d.)., we
should include cultural values when analyzing the decisions of different
societies as every culture has their own unique way of judging value, costs and
rewards. For example, Asian societies, such as China and Japan, are collective
cultures that emphasize group harmony and sacrifice for the group. Therefore,
certain individual costs, such as personal freedom or happiness, are not as
important as in individualized cultures. In fact, the negative costs of social
disapproval are more severe in collective Asian cultures.

Application in various

its inception, the exchange framework has captured the interest of
investigators throughout the social sciences (namely social psychology and
anthropology), political science to the field of law, to name a few. In the study by Nord
(1969), exchange theory proved:

            to provide a
useful vehicle for data integration and generation of new hypotheses about
social      conformity and the model
allows for the process of social conformity to be considered in         dynamic terms, treating the influence source
and influenced person simultaneously (p. 174)

have found the framework fruitful in examining interorganizational relations
(Levine & White, 1960). These experts argued that interaction  among 
organizations  can  be 
viewed  within the framework  of  an
exchange model like  that suggested  by 
Homans and that such model is useful in 
understanding  not  only 
health  agency  interaction but  also 
relationships within  other  specific systems. They added the possibility
of applying this skeleton in explaining interaction among organizations
belonging to different systems; moreover, the SET is believed to have obvious
value in  explaining interaction among
units or departments within a single large-scale organization. Rapoport and
Chammah (1965) have used a form of exchange theory to account for conflict,
negotiation, and decision making in both the interpersonal and the
international arenas. In the field of politics, Waldman (1972) relied upon the
exchange framework to integrate understanding of wide-ranging political
activities. He emphasized that the exchange paradigm is helpful to
“explain  the  degree of governmental power and
responsiveness in the allocation of values”, and “the nature of the
particular policy areas in which governments are most likely to intervene”
(p. 118) as well as “to analyze the nature and degree of cooperation
between different party organizations in different contexts”, and
“the nature of leadership within parties in various settings” (p.
121). SET is also applied to elucidate religious  behaviour, 
arguing  that  individuals make choices about religious
behaviour based on their evaluation of the maximum benefits, and religious
behaviour can be understood as social exchange. ( Barrow
& Kuvalanka, 2011; Corcoran,

Real-life examples and comments

implication of SET can be found in almost every aspect of life. Most obvious is
the so-called “envelope culture”. It seems that when people do a
certain favor for a person of high position, that other person, no matter how
exalted he/she happens to be, should, in common fairness, do something  in return. Under such an assumption, people,
from work place to government or even educational institutions, exploit that
“fairness” in the hope of gaining some “return benefit”
from the relationship with those in higher position. It is generally supposed
that the more “envelopes” or the bigger gifts one offers, the easier
it may be for him/her to get promotion (work place), to have things done
smoothly (administrative procedures) and to get the diploma or higher grade (education).
However, not all such actions are counted for practical motivation. For
example, after finishing a course, learners may present the instructor a small
gift just to express their gratitude and respect (at least, in Vietnamese

When it comes to comparing between cost and
rewards, there are ample situations around us that reveal the framework of SET.
Employees who work extremely hard but are
not acknowledged for their efforts may switch their jobs to another that
is more high-paid, or where they get the same benefits for lesser effort. A
bachelorette, while choosing a prospective groom from several alternatives, may
settle for one who is caring, fun, and handsome – things she considers as
rewards while accepting the fact that he is not as rich as the others – a
potential risk in the relationship


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