Social Exchange Theory, Research Paper Example

Introduction

The intent of this paper is to provide a literature review of Social Exchange Theory through analysis of four academic reviews of this topic, providing a summary of their content as well as submitting my own analysis and critique of the contents. The four studies I have selected are designed to be complement each other as there are opportunities for comparison. My review of Social Exchange Theory begins with a study on perceived limitations and flaws to the present understanding of the theory. It offers an opportunity to revisit the original intent and content of Social Exchange Theory in an effort to identify the sources of the content flaws, and how to address them in future studies.

The incorporation of emotions (symbolic exchanges) is the topic of my second literature review that describes the Affect Theory of Social Exchange. This study evaluates different types of exchanges between individuals and organizations, and stresses the importance of group settings to creating stronger, deeper social exchanges that provide enhanced benefit.

The last two studies both focus on the importance of encouraging knowledge sharing to an organization. The first of the two papers is an ambitious, data driven effort to delve deeper into the complexity of the influences that assist and drive knowledge sharing. The study also attempts to evaluate how technology and type of organization can drive those influences. The second review is specific to human resource management and stresses the importance of valuing, creating and training human capital in order to properly encourage knowledge sharing. It also stresses the need to institutionalize effective practices to encourage trust with employees.

Social Exchange Theory Ambiguity

One study suggests that there are significant limitations to the current understanding of social exchange theory. In this review, the author argues that although the theory is valid, relevant and highly influential, there are conceptual ambiguities and it is based on an incomplete set of ideas. The study goes on to describe that these two specified areas of concern are coupled with core values of social exchange theory that have not been integrated and articulated in an adequate manner. The stated purpose of the review is to return to the roots of understanding social exchange theory, and to identify and suggest areas of further research in order to dispel the areas of the theory that remain ambiguous. (Cropanzo and Mitchell, 2005).

Social Exchange Theory may not be clearly defined or properly understood because certain principles have been explored and examined extensively, while other areas of study have not garnered an appropriate amount of attention. This is certainly the opinion of the author of this review, who believes that the principles of reciprocity and negotiated rules have received the lion’s share of attention. However, there is a fundamental lack of research for exchange processes that would properly detail a deeper understanding of how people regard different types of interactions and how they can be construed as positive or negative social exchange. In addition, studies have had a tendency to focus on a specific rule and/or principal instead of considering in more detail that multiple rules and principles may apply and complement each other, and could alter the results of how interactions proceed. This would especially be true if exchanges are symbolic and not economic, as symbolic exchanges have a tendency to be more emotional, and at times less predictable (Cropanzo and Mitchell, 2005).

With my previous background in Human Resources, what I found particularly interesting was how the review examined how Social Exchange Relationships develop in a work environment. The study reinforces the general principles that workers will form a social relationship with their immediate supervisor, and that generally workers will take care of a company that they perceive is taking care of them. Although different models used by researchers show strong support of these principles, interactions among workers can be very complex and individualized. Different models do generate varying results of how these tendencies are measured. (Cropanzo and Mitchell, 2005).

As for my critique, people are complex, and emotions in particular can be hard to predict and quantify. The assertion of this paper that Social Exchange Theory is in practice used imperfectly because it is still has ambiguous qualities seems plausible. The review argues that more study needs to go into other exchange rules such as interpersonal exchanges, and that more studies need to be conducted where multiple rules are considered simultaneously. This would also seem to have merit. However, the study needs to also acknowledge that people’s emotions cannot be fully quantified, and nor can people be expected to always react in a predictable manner. The sheer power of emotions can overwhelm rationality at times, so variables must also be assumed to always exist, and to be accounted for, in any given study.

Emotions and the Affect Theory of Social Exchange

Given the power of emotions and how they can influence behavior and responses, I found this review to be of particular interest. In this study, the author introduces emotions as the central theme of social exchange process, and the stated contribution to exchange theory is to identify that emotional affects due to exchanges vary both in form and in intensity. In addition, the review defines social exchange as a natural joint activity, but the levels of attachment or interconnectedness will vary. The study further identifies that group activities will encourage closer and stronger levels of social exchange. As for the examination of emotion itself, the author differentiates between global (weaker) and specific (stronger) types of emotions, as well as defining the difference between emotion (feelings) and sentiment, which is a relational, enduring state that links emotions to social units or outcomes (Lawler, 2001.)

The review makes several general assumptions that are supported by previous research. While this could conceivably lead to an incorrect study if the assumptions are flawed, it is important to note that these assumptions are based on multiple, well documented research studies that generally reinforce each other’s conclusions. In summary, the assumptions state that social exchanges produce global emotions, internal in nature, that are either positive or negative. People are driven to reproduce positive global emotions and avoid the negative ones, which also generate intellectual efforts to understand the emotions. When this is done within the context of a group, the emotions are applied to an the entire group and not just the individual. These assumptions taken collectively by the author are used to reinforce the assertion that emotions within a group setting encourage stronger attachments (Lawler, 2001.)

The author uses the study to promote core propositions of the Affect Theory of Social Exchange. These propositions collectively lead to the conclusions and assumptions made for this study. Collectively, the propositions reinforce the values of shared responsibility within a group setting, which in turn create stronger emotional connectivity. Different exchange structures (productive, negotiated, reciprocal) produce stronger perceptions of shared responsibility to varying degrees, and that positive exchanges within a group setting creates a dual benefit of producing both pride in self and gratitude toward others within the group. However, there is also the negative potential of a group setting, where failure could lead to anger towards others within a group, especially if the outcome is considered controllable within the group setting. As groups can be connected over a period of time and through many exchanges, repetition of such exchanges can enhance and create dense connectivity that can be either positive or negative in its cumulative effect (Lawler, 2001.)

As for my critique on this study, the author does an effective job of demonstrating the fundamental strength of emotions. In comparison to the study by Copranzo and Mitchell, there are attempts to delve deeper and address some ambiguity of the Social Exchange Theory by enhancing understanding of the complexity and depth of emotional impact on social exchanges. However, Copranzo and Mitchell’s assertion that Social Exchange Theory needs further study on how multiple rules can apply collectively would be valid for this study, as there are other forces and rules that could restrict or alter the fundamentals of the Affect Theory of Social Exchange.

Social Exchange Theory and Encouragement of Knowledge Sharing

The following is the first of two studies that examine Social Exchange Theory as it relates to information sharing. In this first review, the author describes how critical information sharing is to providing a competitive advantage to businesses. As with the Copranzo and Mitchell article, this study also concludes that drawbacks to previous studies and current understanding of Social Exchange Theory includes contradictory conclusions from prior research. They cite interpretation of results as a primary reason for these varied conclusions. What the authors of this study attempt to do is to create a study that evaluates individual cognition (benefits to self and commitment to organization), interpersonal interaction (trust and social interaction), and organizational context (organization’s reward systems). The study also attempts to determine if either technology or type of organization can affect results (Liang, Liu and Wu, 2008).

The review provides good detail on its methodology, which describe as meta-analysis, or review and analysis of descriptive statistics. Databases and studies were carefully evaluated under a set of specific criteria in order to determine which ones were suitable for this analysis. Of an initial search of 493 papers, 29 were selected for use. From these studies, eight variables were identified for the data to be classified: perceived benefit, organizational commitment, social interaction, trust, organizational support, reward systems, and knowledge sharing behavior. The study determined that all of the variables except one did have a significant effect of knowledge sharing behavior. The only exception was organizational support, which is the global belief that an organization values employee contributions and cares about them (Liang, Liu and Wu, 2008).

My critique for this study begins with admiration for the methodology and its ambition, as they did attempt to layer multiple considerations and effects within their review. However, the paper was largely focused on proving the methodology and did not provide adequate detail on what was actually learned. Although the study briefly theorized on why organization support did not significantly affect knowledge sharing behavior, it does not goes into detail on the matter even as the study concedes that this was not an expected outcome. The study was well done, but with additional detail the review would have told us much more.

Social Exchange Theory and Knowledge Sharing Through Human Resource Management

As Human Resources is my background, I was interested in studies specific to the Human Resources field in the context of a business. This paper highlights the importance of incorporating human resource management and institutionalism into Social Exchange Theory. The paper stresses key perspectives human resources should adopt to encourage knowledge sharing, which includes motivation and retention of employees, a high commitment to encouraging knowledge sharing, development of human resources practices and training of workers (Andolsek, 2005).

In order for an organization to reap the benefits of knowledge sharing, they need to examine themselves first and foremost. Organizations have to develop human resource management practices that encourage and reward knowledge sharing. In order for knowledge exchange to occur, workers must have an unfulfilled need that the organization is capable of filling. As long as workers have favorable exchanges the organization can expect knowledge sharing to continue. Trust is a key factor between workers and the organization to establish such knowledge sharing, and when the established order of exchange processes are institutionalized and retained, workers trust and knowledge sharing are enhanced (Andolsek, 2005).

My critique on this work is that although it is less ambitious than the study conducted by Liang, Liu and Wu, it effectively augments Social Exchange Theory in one key area. This study stresses the importance of institutionalizing the established order of the exchange process as a way to strongly encourage knowledge sharing. Through this effort, trust is enhanced and workers can more easily predict and organization’s behavior.

Conclusion

Within Human Resources, I have experienced first hand the importance of knowledge sharing, trust, and the fundamentals of Social Exchange Theory. It is always important to maximizing the relationship and benefits between employees and their organization. Businesses have finite resources, and publicly traded corporations typically have aggressive financial goals and a desire to minimize costs. It is well documented among many businesses how much investment goes into the training of new employees. When those employees are not retained, it becomes a sizable cost of doing business. In summary, properly executed Social Exchange Theory is a sound business practice that saves your business resources while avoiding additional expenditures.

I previously had an experience at a corporation where economic conditions became less favorable and the company was in a position where they had to reduce hours and downsize staff. Conditions at work became very tense as employees were “laid off.” It became such a point of distraction as everyone talked about and feared being the next to be asked to leave. Because there are legal ramifications involved and company policies that had to be followed, as a human resource professional I was not in a position to relate to individual employees what was going to happen, how extensive the lay offs would be, when they would be announced or when they would be over. It should be noted that I was also unaware of my employment status. The same rules that applied to me applied to my supervisors, and they would also be in no position to either assure me that my job was safe, or that I would be asked to leave. This situation persisted over the span of a few months, and during that time there was a profound impact on how social exchanges took place within the workplace.

This situation I experienced would have been difficult under any circumstances, but effective Social Exchange Theory practices do provide benefits. As in Lawler’s study on the Affect Theory of Social Exchange, the sheer power of emotions were very strong in a situation where co-workers, many of whom had worked for the company for many years, were being asked to leave with little or no warning. The rumors were rampant, widespread, and often had little basis in truth. Many of the rumors described the poor way the company was handling lay offs, how employees were the victim, and how badly the corporation had treated them. Such rumors and company conditions are very destructive to trust, and as Lawler’s study stresses the importance of group mentality to establishing effective exchanges, the study also emphasizes such exchanges can be either positive or negative in nature.

Cropanzo and Mitchell also cited the importance of the employee perception that the company will take care of them, and they in turn take care of the company. The situation I experienced amounted to a betrayal of that trust, and unfortunately I experienced this lack of trust in both a personal and professional manner. As an employee in Human Resources, knowledge sharing was problematic. In the Andolsek review, the author relates how some information is under the strict control of their holder who will no share knowledge when they perceive an inferior exchange. In my situation co-workers assumed that I was not at liberty to discuss what was happening, so they refrained from sharing meaningful input with me as they did not see that they would be receiving an equitable exchange of information.

In closing, knowledge sharing is always important in order to encourage effective social exchange theory practices. While there was no way to avoid the situation I experienced at my previous employer, I often wonder why the company could not have acted more quickly with providing the information on who would no longer be employed. In addition, statements providing information explaining the situation and why downsizing staff was necessary could have served to help employees understand what was happening, and why. After all, most of the employees would be retained, and it was still necessary to foster trust and positive social exchanges that would assure these employees that the company valued them and still wished for them to remain productively employed. Even in a down economy where bad news was abundant, effective Social Exchange Theory can be effectively practiced, and if anything was even more critical to the success of my business during that period of time.

References

Andolsek, D.M. (2005). Knowledge Sharing Through Social Exchange Theory Perspective. Retrieved July 27, 2012 from http://organizacija.fov.uni-mb.si/index.php/organizacija/article/view/401.

Cropanzo, R. and Mitchell, M.S. (2005). Social Exchange Theory: An Interdisciplinary Review. Journal of Management, 31, 874-900.

Lawler, E.J. (2001, Sept.). An Affect Theory of Social Exchange. The American Journal of Sociology. Vol. 107, No. 2.. 321-352.

Liang, T., Liu, C. and Wu, C. (2008). Can Social Exchange Theory Explain Individual Knowledge-Sharing Behavior? A Meta-Analysis. International Conference on Information Systems (ICIS). ICIS 2008.