Two Approaches to Social Structure: Exchange Theory and Network Analysis Author(s): K. S. Cook and J. M.

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Annu. Rev. Sociol. 1992. 18:109-27 Copyright ? by Annual Reviews Inc. All rights reserved

TWO APPROACHESTO SOCIAL STRUCTURE:Exchange Theory and Network Analysis

K. S. Cook and J. M. Whitmeyer
Department of Sociology, University of Washington, Seattle, Washington 98195

KEY WORDS: social exchange, exchange networks, power, social networks

Abstract
Much convergence exists between exchange theory and network approaches to social structure. Starting with the work of Emerson, exchange theory increasingly has considered social structureexplicitly, as both product and constraint.Exchange theory and network analysis both conceptualize social structureas a configurationof social relations and positions, i. e. as a set of actors diversely linked into networks. Exchange theory and most work in network analysis are based on similar conceptions of the actor. Where exchange theory and networkanalysisdiffer is in theirview of the links between positions. Exchange theory stresses the exchange aspects of all ties and networkin any analysis is one that contains all contends that the appropriate relevantexchange relations. Networkanalysistends to be more catholic about the nature of the links.

INTRODUCTION
Social structureis one of the central concepts in sociological analysis. It is also at the core of many of the most influential theories within the field of sociology. Durkheim, Parsons, Levi-Strauss, Marx, Weber, Merton, Coser, 109 0360-0572/92/08 15-0109$02.00

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Blau, Coleman, and many others have developed conceptions of social structurein their attemptsto provide explanatoryframeworksthat encompass both humanbehavior and institutionalpersistence and change. Our task here is to begin to specify how two different literatureswithin sociology can be broughttogetherin the analysis of social structure and structural forms. These two traditionsare exchange theory and network approachesto structure.To accomplish this task we provide a brief statement of historical context, placing this chapterin the relevantstreamof work thathas been conductedon the topic of social structure.This statement is followed by reviews of the commonalities and differences in the approachesto structuretaken by exchange theorists and network analysts. We conclude with comments about future developments linking these two traditions. A fairly comprehensive treatmentof the different approaches to social structurecan be found in the volume edited by Peter Blau (1975). Various conceptionsof social structurearepresentedby authorsthatinclude Bierstedt, Blau, Bottomore, Coleman, Coser, Goode, Homans, Lenski, Lipset, Merton, Parsons, and Wallace. Blau identifies three majorapproachesto social structure:(i) social structure as a configuration of social relationsandpositions, (ii) social structureas the substratum that underliesall of social life and history, and (iii) social structureas a "multidimensional space of the differentiated social positions of the people in a society or other collectivity" (Blau 1975:14). The approachto social structureadoptedby exchange theorists (including Blau 1964) and a majorityof the networkanalysts is the first alternative,the configurationalapproach.We focus primarilyupon this general approachto social structure.We omit from our discussion the structuralism characteristic of Levi-Strauss (though this is mentioned, by Ekeh 1974, as a distinct tradition within exchange theory) and subsequent developments along this line. What Blau refers to as the multidimensional approachis characteristic of his more recent work (e.g. Blau 1977). In the next section we first review the treatmentof social structureby exchange theoristsand then move to network approaches.

SOCIAL STRUCTURE:AN EXCHANGE PERSPECTIVE

Exchange theorists advance a basic image of social structureas a configuration of social relations among actors (both individual and corporate),where the relations involve the exchange of valued items (which can be material, informational, symbolic, etc). Exchange theory increasingly has involved explicit consideration of social structure, as both product and constraint, typically in the form of networksof social relations. We will comment on the similarities and differences in the perspectiveson social structureof three of the principal exchange theorists in historical progression.

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Homans' View of Social Structure

Homans' (1961, 1964) primarypurposewas the study of the "subinstitutionforms of behavior. Homans developed a theory of social al" or "elementary" behavior based primarilyupon behavioralprinciples of analysis. He took as the domain of his explanatoryframework (1961:3), "the actual social behavior of individuals in direct contact with one another."He refers to this behavior as elementaryand clearly distinguishesit from behaviorthat can be defined as obedience to the norms of a society (including role-related bebehavior, thus actual havior). Role-conformingbehaviorwas institutionalized behavior was defined by Homans as subinstitutional. For Homans, social structuresemerge from elementaryforms of behavior and change over time in response to changes in this behaviorby aggregates. (He does not addressin any detail the complex interplaybetween microlevel processes and aggregatelevel outcomes.) He arguedthat the similarbehavior and institutionsand even, of enough people can alterexisting social structures under some conditions, replace them. "Sometimes the great rebellions and revolutions, cracking the institutionalcrust, bring out elementary social behaviorhot and straightfrom the fissures"(Homans 1961:398). His analysis of social behaviorendures as a classic in sociology precisely because his vision of the underpinnings of social structureand institutionalforms is straightforward and is linked so clearly to the actions of individuals (i.e. to their responses to rewardingand punishing circumstances). Though the focus of Homans' theoretical framework was the relations between actors in direct contact with one another, he did acknowledge the structural importanceof indirectexchange relations. An example is the social relationbetween employees of the same employer, who are related indirectly in second-orderexchange relations throughtheir common link to the same employer. In this sense the basic format for exchange network analysis existed in the earliest formulations.

Blau's Early View of Social Structure

While Homans' work is distinctly microsociological in character, Blau's (1964) major treatise on exchange and power is an explicit statementof the micro-macrolinkage problem, before micro-macroissues became a fashionable topic in sociology in the 1980s (e.g. Alexanderet al 1987, Collins 1981, Cook 1991, Huber 1991, etc). Blau's focus was the developmentof a theory of social structureand institutionsbased upon a sound microfoundation,a theoryof social exchange. Two majorfeaturesdifferentiateBlau's work from that of Homans. First, Blau did not base his theory of exchange upon behavioralprinciples; instead he introducedaspects of micro-economic reasoning into his analysis of distinctly social exchange (see Heath 1976). Second, recognizing that social structureshave emergent properties, he extended the theory beyond subinstitutionalphenomena.

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Blau discusses processes like group formation, cohesion, social integration, opposition, conflict, and dissolution in terms of principles of social exchange. In his view various forms of social association generated by exchange processes over time come to constitutequite complex social structures (and substructures).The coordinationof action in large collectivities is made possible by common values in the social system which mediate the necessary indirect exchanges. Thus Blau's theory moves far beyond direct contact between individual actors, incorporating complex indirect exchange processes. Structuralchange in both small and large social structures is analyzed in terms of social forces like differentiation,integration,organization, and opposition. Blau and, subsequently,Emerson(1972a,b) both made power processes centralto their analysis of the emergenceof social structures and structuralchange.

Emerson's Exchange Network Theory and Related Developments

Of the three majortheorists, Homanswas the most psychological in focus and thus in many respects the most microsociological. Blau focused attentionon the more macro level, emphasizingmicroprocessesprimarilyas a foundation for building a more complex theoryof emergentprocesses in social structures and institutionalchange. Emersondevelopeda behavioralmodel of individual action but emphasizedthe shift to a more macro level of analysis throughthe incorporation of collective actors and networks into his formulation. As Turner(1986:304) puts it, Emerson's approach"removesmuch of the vagueness surroundingHomans' and Blau's conceptualizations of social structures as 'institutionalpiles' and 'organizedcollectives'. Social structurein network analysis has a more precise definitionas patternsof connectionsamong actors in networks of exchange relations." In his seminal work on exchange theory Emerson (1972ab) produced a well-developed formulationbased uponbehavioralprinciples(similarto those found in Homans' work). He embeddedhis generalpower/dependence principle (1962, 1964) in the context of an exchange theoreticalframeworkwhich took as its psychological base, behavioralprinciplesof reinforcement,satiation, extinction, etc. PartII (1972b) of this work takes social structureas the centralsubject matterand includes rudimentary theoreticalstatementsregarding mechanisms of structural change (see Cook 1987:216-7 for a description of the model of social structuredeveloped in Part II). Emerson (1972a:41) noted two major shortcomings with Homans' behavioral formulation.First, it had no real conception of society except as an aggregation of individual behavior. In this sense its conception of social structurewas too rudimentary. Second, it treatedas "given"the social context surrounding"behavingpersons," that is, the social structuresand structural changes that sociologists seek to comprehend.

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An actor in Emerson's theory is conceived as a "point where many exchange relationsconnect"(1972b:57). The actorcan be a person, a corporate group (or collective actor), or a role-occupant. This conception of "actor" makes the theory applicableat differentlevels of analysis, and the theory has been appliedto relationsbetween individuals,organizations,and even nationstates. The primaryfocus is upon exchangerelationsas the buildingblocks for more complex social structures called exchange networksor corporategroups (involving intragroupexchanges). As Emerson (1972b:60) notes, "the concept of an exchange relation, and the principleswhich surroundit, provide a basis for studying the formationand change of social structuresas enduring relationsamong specified actors, with the exchange relationsas the structural unit." Exchangenetworksare viewed as connectedsets of exchange relations. An early, importantadvance was the distinction between positive and negative exchange connections. If an actor's exchange in one relation is positively relatedto the actor's exchange in anotherrelation, the relationsare positively connected;if the relationshipis negative, they are negatively connected' (for furtherdiscussion see Emerson 1972b). A primaryfocus of the subsequent theoreticaland empiricalwork (e.g. Cook 1987) has been on specificationof the principlesof exchange and power that apply to differentkinds of network structures(which Emerson referred to as "structuralprototypes," such as monopoly structures,stratifiednetworks, circles, and chains). In particular, attention has been focused on the relationshipbetween types of exchange connections and the distributionof power and dependence among actors in various network structures(e.g. Cook & Emerson 1978, Cook et al 1983, etc). Structuralchange is viewed in the theory as a consequence of various social processes (e.g. coalition formation)in exchange networks and within corporategroupsinitiated,in part,because of a power imbalanceeitherwithin the exchange relation (relationalpower imbalance) or within the exchange network structure(structural power imbalance)(see Gillmore 1987, Cook & Gillmore 1984, Cook & Emerson 1978, Emerson 1981, Molm 1989, Cook 1990, etc). In conclusion, exchange network theory, initiated with Emerson's work (e.g. 1972a,b and subsequentwork) and continuing in that of others (e.g. Cook 1977, Cook & Emerson 1978, Willer & Anderson 1981, Markovskyet al 1988, etc), has attemptedto fuse perspectives previously considered incompatible(see Blau 1975, Merton 1975), incorporating both psychological factors and social constraintsin terms of alternativesand opportunitystruc'The actual definitions (Emerson 1972b:70) are: a negative connection is one in which an increase in "the frequency or 'magnitude"' of one exchange in which an actor is involved "producesor implies a decrease" in a second such exchange. A positive connection is one in which an increase in one exchange in which an actor is involved "producesor stimulates"an increase in a second such exchange.

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of recentdevelopments tures. This is, in our view, the majoraccomplishment in exchange theory (referred to as either structuralversions of exchange theoryor exchange networktheory). It is this more recentversion of exchange view of social structure theory which is most compatiblewith the fundamental embedded in much of the work in network analysis. We now turn to an explicit considerationof the relationshipbetween exchange theory and network analysis, beginning with an overview of what network analysis is.

LINKING EXCHANGE AND NETWORKAPPROACHES What is Network Analysis?

In discussing the potentialfor linking these two traditionsof work in sociology we must begin with one key difference. Exchangetheoryis really the name of a class of theories all of which have much in common (e.g. the theories of Homans, Blau, Emerson, Thibaut& Kelley, Colemanetc). Exchange theory can be seen as an approachto interactionand structurebased on two principles: (i) The actor can be modeled as motivated by interests or rewards/ punishments-i.e. all behaviorcan be seen as so motivated;(ii) most interaction consists of the exchange of valued (though not necessarily material) items. Network analysis, on the other hand, has been less theoretically and more empirically driven (see Wellman 1983). Network analysis is rooted in the empirical observationthat patternsof interactionof many actors can be looked at as networks. A narrowconception of networkanalysis exists, which considers it a type of "structural" analysis. "Networkanalysts. . . try to describe [regularnetwork patterns] and use their descriptions to learn how network structures constrain social behavior and social change" (Wellman 1983:157). This version of network analysis contends, in agreementwith the "structuralist" position in Sociology (e.g. Blau 1977, Mayhew 1980), that all important social phenomena can be explained primarily, if not completely, by social structure.The networkversion of this position is professed by, for example, Berkowitz (1982), Wellman (1983), Skvoretz (1990), and, to some extent, Burt (1982b). For three reasons, we take a broaderview of networkanalysis. First, many network-relatedstudies do not fit with the more narrow conception of the structuralist approach, such as studies of the creation and/ormaintenanceof networks(e.g. Galaskiewicz 1982, Mizruchi& Stearns1988), or with studies that investigate the influence of non networkfactors on networkcharacteristics (e.g. Feld 1981, Fischer 1982, Laumann& Marsden1982). We wantedto include these. Second, by excluding considerationof the individualactor, the narrow structuralistapproach excludes linkage of network analysis with exchange theory. We consider such a linkage to be both naturaland potential-

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in are less strictly structuralist ly fruitful. Third, some network structuralists practice than in principle (e.g. Burt 1982b). Numerous reviews of network analysis exist (e.g. Mitchell 1974, Berkowitz 1982 ch. 1, Wellman 1983, Marsden 1990), so the history we present here is brief. The contemporaryarea of network analysis has been formed througha cross-fertilizationof work from several different disciplines, with different empirical and even theoreticalaims. We can identify at least three sources for networkanalysis:empiricalwork in social anthropology(e.g. Bott 1957, Mitchell 1969, Kapferer1972), the practiceof sociometry (e.g. Moreno 1951), and more abstractmathematicalmodels and theory such as biased net theory (Rapoport1957) and graphtheory (e.g. Hararyet al 1965). As is evident in this review, the diversity of origins continues in the present diversity of subjects of empirical research and structuralinterests (e.g. network structureas an independentor dependent variable). The development of network analytic tools and techniques proceeded rapidly, beginning in the early 1970s, among anthropologistsand sociologists. Debate among the early network analysts focused not only on the appropriatemeasures of importantconcepts and methods of data collection (e.g. observation, diaries, surveys), but also on whether or not there was anything to be called "networktheory." To some extent, this debate continues. Positions on the issue range from that of Barnes (quoted in Mitchell 1974:282): "thereis no such thing as a theory of social networks,"to that of theoryof action to providetheoretiBurt (1982b) who formulateda structural cal underpinningfor network conceptions of structure. According to Marsden(1990:453), much networkanalysis "can be viewed measures."These as part of a researchprogramto develop social structural measurescan then be utilized by varioustheoristsin their efforts to include in their theories and empirical research measures of social structuralconcepts (e.g. range, centrality, and density of actors' social networks-see Marsden 1990 for a comprehensivereview). For example, network analysis has been combined with functional analysis and role theory. Recently, proposalshave been made to combine it with expectation states theory (Fararo& Skvoretz theory (Haines 1988). 1986) and with Giddens' structuration From the beginning some network analysts used exchange theory to provide the theoretical basis for the analysis of the social interactions they representedin network terms (e.g. Kapferer 1972, Whitten & Wolfe 1974, etc). Various authors (e.g. Turner 1986, 1987, Collins 1988, etc) have commentedon the potential for linking exchange and network approachesto social structure.Collins (1988:412), for example, remarksaboutthe "growing awareness of the connection between networks and market or exchange theories... two conceptions of how individuals link together into a larger social structure."In an influentialreview piece, Mitchell (1974) arguedthat

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transactionaltheories (including exchange theory) formed a naturalalliance with network concepts. Kapferer(1972) even proposed exchange theory as "the most suitablebasis for networkanalysis"(quotedin Mitchell 1974:282). We agree with Kapferer. However, since exchange theory and network analysis are different types of entities, it is difficult to talk about integrating them without clarifying the specific ways in which they are compatible or differincompatibleas perspectives. One obvious but relatively unimportant ence is in how these approachesare practiced-how hypotheses are tested, how the data are gathered and analyzed, etc. More critical for the issue of linkage between them are compatibilitiesand incompatibilitiesin (a ) their views of action, i.e. the models of the actorunderlyingeach approach,and (b) their views of structure.We discuss each of these topics, along with some prescriptionsregarding future developments that might integrate aspects of these two traditionsin ways quite fruitful for sociologists.

The Individual-LevelModel
No two theoreticalapproachesare compatible, nor can they be linked effectively, if they have fundamentallydifferent models of the individual actor. We believe that most work in networkanalysis is at least compatiblewith the exchange theory premise of the actor as motivated by interest or reward/ punishment. However, that which is not compatible cannot be linked with exchange theory. For example, Haines (1988) advocates basing network analysis in Giddens's "conceptionof agency"-an alternativeindividual-level model incompatible with that of exchange theory. Similarly, Fararo & Skvoretz (1986) suggest basing networkanalysis in expectationstates theory. This work may be compatiblewith exchangetheory, but only if the individual level models of expectationstatestheoryand exchange theoryare compatible, which seems dubious (see, e.g., Berger et al 1972b). Burt (1982b) claims to have a different model of the actor, but this is an overstatement.Exchange theory analysis holds (i) for any model of the actor wherein the actor pursues interests whateverthey may be, and (ii) where at least some of the interests are satisfied throughsocial interaction.Exchange theory makes no commitmentto the origin of those interests, althoughsome individual exchange theorists do have their preferredsupplementary,more microlevel models on this point. These may conflict with Burt's model which says that an actor's interestsstem from the actor's networkposition. However, Burt's model is fully compatible with the most basic principles of exchange theory. Namely, Burt's actors do have interests, some of which they do pursue and obtain through social interaction. Biased-net theorists (e.g. Fararo& Skvoretz 1987, Skvoretz 1990) claim that no individual-levelmodel is necessary, a position which echoes the views such as Mayhew (1980) and Blau (1977). of other non network structuralists

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Biased-net theory describes and even seeks to explain (see Skvoretz 1990) network structure as global or regional deviations from randomness (or to the stated "biases"),possibly in a numberof differentdimensions. Contrary claim that no model of the actor is necessary, this theory implies and indeed requires a certain model of the actor. Namely, actors must exhibit these biases, and apartfrom the biases there can be no other deviation of actors' behaviorfrom randomnesslarge and widespreadenough to distortthe picture of the network. This model of the actor clearly is different from that of exchange theory and makes these two approachesincompatible.2 One assumptionconcerningthe model of the actoris criticalto much work in networkanalysis and exchange theory. This is the assumptionthatthe same model of the actor can be used for organizations(or perhapsspecific types of organizationssuch as corporations)and for individualhumans. This assumption is widespread among network analysts whose actors are organizations (e.g. Laumannet al 1985, Mizruchi 1989, 1990ab), and widespreadamong exchange theorists (e.g. Emerson 1972b, Markovskyet al 1988) and indeed some other theorists in sociology (e.g. Berger et al 1989). Yet both a prioriconsiderationsand empiricalevidence call the assumption into question (see Caputo 1989, Stinchcombe 1989). Social organizationsare made up of entities with their own interests and capable of acting autonomously; humanbeings are not. For example, in his analysis of the creationof institutionsby corporatedonor and nonprofitdonee organizationsto reduce the transactioncosts of donations, Galaskiewicz(1982) must make use of the differences of interests within organizations. The issue of the validity of the organizational actor is related to the extensive debate (cf Mizruchi& Schwartz 1987) between the resourcedepenties in dence and the social class positions over the purposeof intercorporate the form of interlockingdirectorates.The resourcedependenceposition (Perucci & Pilisuk 1970, Pfeffer 1972, 1987, Pfeffer & Salancik 1978, Berkowitz et al 1978/1979, Burt et al 1980, Burt 1983, Mizruchi 1989, 1990a,b) argues ties are created for the purpose of maximizing corporate that intercorporate profit throughlessening corporatedependence, and that they are effective at this. This perspective is strongly relatedto the exchange theory perspective, with the actors involved being organizationalactors (Bergeret al 1989). The class position (Zeitlin 1974, Domhoff 1975, Soref 1976, Useem 1978, 1979, 1984, Bonacich & Domhoff 1981, Gogel & Koenig 1981, Palmer 1983, Palmer et al 1986, Bearden & Mintz 1987, Soref & Zeitlin 1987, Johnsen & ties are created as a result of human Mintz 1989) argues that intercorporate individuals (or families) pursuingtheir own class interests. This position is
2Some biases may generatestructurewhich resembles that generatedby exchange processes. However, our concern here is with differences in the underlying models of the actor.

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also compatible with exchange theory if it is accepted that elite individuals' personalinterestsare congruentwith theirclass interests.Most versions of the class perspective fit this formulation. The elite network may be seen as an example of a social circle, a type of social structurewhich Emerson (1972b) explains in exchange terms. Here, however, the actorsare humanindividuals. There is some empirical evidence for each position. The centrality of networks, for example, has been well financial institutionsin intercorporate established (Mariolis 1975, Sonquist & Koenig 1975, Mintz & Schwartz 1981, Mizruchi 1982, Stokman et al 1984). Mizruchi (1989, 1990b) has network positions, especially the existence of inshown that intercorporate direct links through financial institutions, predict similarity of political behavior (contributionsto PACs). On the other hand, Bearden& Mintz (1987) network, found that while banks were indeed central in the intercorporate bankersas individualswere not prominentin linking roles. Johnsen & Mintz (1989) looked at the directornetwork, the "dual"(see Breiger 1974, Berkonetwork, and found social ties generallyto be witz 1982) of the intercorporate links between individuals. Studies have found causally priorto intercorporate a low rate of reconstitutionof directorateties that are accidentally broken (Koenig et al 1979, Palmer 1983, Palmer et al 1986). As a commenton both positions we may add Galaskiewicz's (1989) points, in his presentation of unresolved questions concerning interorganizational level, that (a) ties createdfor one reason may be networksat the metropolitan used for another(p. 82); and (b) creatingties for some purposedoes not mean necessarilythatthey will be effective (p. 86). Similarly, we may note that it is possible that interlockingdirectorateties are created accordingto individual human interests, yet other organizationalbehavior is best explained by the dependence of organizationalactors. This issue is not yet resolved.

The View of Structure

We can distinguishtwo generalconceptions of structurein networkanalysis. The more common view conceives of structureas a patternof particularties between actors, where variationin the networkin the existence or strengthof ties is meaningful and consequential. The other conceives of structureas a groups, or perhapsthe entire generaldeviationfrom randomties for particular network. In other words, the first view sees structureas a composition of particular ties, the second sees structure as a general perhaps multidimensional deviation from randomness.The second view is the biased net perspective (e.g. Rapoport1957, Fararo& Skvoretz 1987). The first view is taken by virtually all other network analysts and is also that of exchange theorists (Collins 1988). Thus the general view of structureof most networkanalysts and exchange theoristsis the same. Wheredifferencesexist is in theirviews of the details of

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structure-the ties. These differences constitute the greatest challenge to compatibilityand linkage between the two approaches.In brief, fitting their theoreticalbase, exchange theorists assume that ties consist of the exchange of valued items. Fitting their more empiricalstartingpoint, network analysts are frequently more catholic about the content of ties (Marsden 1990). However, there is much variation in the treatment of content, between networkanalystsand even within the work of individualscholars. Frequently, this depends on the aspect of the structure-actionrelationship being investigated. Therefore, we look at some of the network analysis literatureto examine the compatibilityof the exchange theory stance with various treatments of tie content. to show the effects of action on structure Virtuallyall studiesthatundertake clearly take ties to consist of exchange. That is, studies that look at the construction or maintenance of networks (e.g. Verbrugge 1979, Wellman 1979, Burt 1982a, Feld 1981, 1982, 1984, Galaskiewicz 1982, Palmer et al 1986, Suitor 1987, Mizruchi& Steams 1988, Barley 1990, S. L. Feld & J. J. Suitor, unpublishedpaper,3 N. P. Hummon, unpublishedpaper4)or which analyze the effect of variation in personal characteristicsor the interests of (e.g. Fischer 1982, Laumann& actors on variationin networkcharacteristics Marsden 1982, K. E. Campbell & B. A. Lee, unpublishedpapers5)specify the ties in their networksexplicitly or implicitly as exchange ties. Thus, they are entirely compatible with exchange theory. The reasoning behind Granovetter'svarious arguments(Granovetter1973, 1983) concerning the creationand effects of strongand weak ties is in accordwith exchange theory principles. For example, strongerties mean more secure access to resources; thus those with fewer personalresourcesare more likely to rely on strongties (Granovetter1983). A few studies undertake to show the effect of structure not, or not only, on actionbut on affect (e.g. Fischer 1982, Marsden1983). These studiestoo take an exchange view of ties. For example, Fischer (1982) finds that network density is positively relatedto feeling betterfor low-income respondents,but negatively related for high-income respondents.For an explanationhe suggests thatlow-income people are betteroff with dense cliques because, unlike high-income people, they lack the material and social resources to manage dispersed networks (p. 150).
3S. L. Feld, J. J. Suitor, Mothers and bestfriends: alternativesources of social supportfor young married women in seven western countries. Paper pres. at X Sunbelt Social Network Conf., 1990, San Diego, Calif. 4N. P. Hummon, Organizational structures and networkprocesses: an exploration of exchange processes. Paperpres. at X SunbeltInt. Social Network Conf., 1990, San Diego, Calif. 5K. E. Campbell, B. A. Lee, Personal networks in urban neighborhoods:description and variation, 1991. B. A. Lee, K. E. Campbell, Neighbor networksof blacks and whites, Paper pres. at ASA Annu. Meet., 1990, Washington, DC

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The difficulties arise with some studies that examine the effect of structure on action, or in some cases, on other aspects of structure.The exchange theory position concerningthis relationshipis thatthe relevantnetworkis one that consists of all relevantand important ties due to exchange (i.e. of valued items) and only those ties. Granovetter(1985) has called for acknowledging the close embeddedness of behavior in networks of interpersonalrelations. Since interpersonalrelations are virtually always exchange relations, the exchange theory position is completely in agreementwith his argument. The exchange theory position is compatible with many network analysis studies (e.g. Marsden 1983, 1987, Coleman 1988, Ridley & Avery 1979). However, accordingto this position, many other studies are too permissive. They include certain types of ties without theoretical justification (i.e. specification in exchange terms); they leave out importanttypes of ties and important actors. They also fail to pay enough attention to the interplay between interestsand the items being exchangedandto the differingeffects of complementary,common, and opposing interests. Thus they fail to perceive the structuralimplications of these few-actor interactionalcomplexities. As examples, we consider the widely used concept of the directionalityof ties as well as some recent work on centrality. The directionality of ties frequently is an importantfactor in network analyses. For example, Knoke & Burt (1983) define prestige to be a measure of the degree to which an actor is the object of connections. However, whenever a relationconsists of exchange, any purported directionalitycomes from specifying only one side of the exchange. In such a case, apparent directionality is due to the incomplete specification of content and is a spurious factor. For example, Knoke & Burt (1983; see also Burt 1987) measurethe prestige of physicians in terms of being solicited for advice. But this is an exchange: the solicitation is exchanged for advice (Blau 1955, Homans 1961). The connection could just as easily be specified with the opposite directionality,i.e. being the object of advice-giving. Thus, prestige stems not from directionalitybut from the content of the exchange relations and the asymmetry involved. Centralitygenerally is taken to mean "networkposition-conferredadvantage." In the network analytic literature,more attentionhas been given to its specification and measurementthan to any other issue (e.g. Bonacich 1972, 1987, Freeman 1979, Knoke & Burt 1983, Marsden 1982, 1983, 1987, Mizruchi et al 1986, Stephenson & Zelen 1989, Friedkin 1991). Recently some new measures have been devised specifically for centrality in communication networks in which exchange is ignored (Stephenson & Zelen 1989, D. L. Kincaid, unpublishedpaper,6Friedkin 1991). Exchange theory
6D. L. Kincaid, Communication networkdynamics:cohesion, centrality, and cultural evolution, 1990

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claims that interactions,and by extension the effects of networkstructureon action and structure, occur only due to the exchange value of the items transferred(which may be material, symbolic, informational,etc).7 Therefore, when the exchange relations in the network are obscured, the causal processes involved in centralitywill be likewise hidden. When the exchange relations are excluded, the results are likely to be spurious if not in error. Not all studies involving communicationnetworks are at odds with exchange theory. The effect of network structure in Bonacich (1990), for example, is explained as the effect of network position on the expected relative gain from communicatingversus not communicating.Network structureis shown to affect the likelihood of an actorcommunicatingin the kind of "communicationdilemma" situations studied by Bonacich. In Laumann& Knoke (1989; see also Galaskiewicz 1979, Knoke 1983) ties in the communicationnetworkspersist due to the actors' dependenceon the information and the similarities in the actors' interests. Exchange theory, however, suggests an alternativeto be tested against explanations in terms of communication networks which ignore exchange processes. First, all exchange links relevant to the behavior which is the dependent variable should be included in the analysis (see Galaskiewicz 1989). For example, Kincaid (see footnote 6) presents a network of communicationconcerning family planningfor a Koreanvillage (from Rogers & Kincaid 1981). Are there exchange links to people with interests in the behaviorsin questionthat are not representedin the communicationnetwork? If so, it is likely that exchange theory would make different calculations of centrality and perhaps even different predictions concerning its effects. Second, ties should be consideredin terms of the valued items exchanged. Accordingto exchange theory, the very existence of a tie or link, including a communicationtie, suggests the existence of interested exchange between two parties. The content of the communicationsmay be influential, but even so the communicationmust be considered in the context of an exchange of valued items, whetherthese are the communicationsthemselves (i.e. in terms of informationalor symbolic value) or other items. For example, for the measures of centrality he proposes for "social influence networks,"Friedkin(1991) provides a theoreticalbasis in the form of coefficients meant to represent one actor's influence on another. For an exchange theorist, however, this is insufficient, because the interactional process goes unspecified. If the influence does not occur throughexchange processes in the given network, exchange theory suggests that relevant exchange processes are being ignored and that the effects of the given influence

'Exchange theorydoes acknowledge the effect of previouslyexisting ties, that is, of ongoing exchange relationships.

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channels are possibly spurious. If the influence does correspondto exchange processes, collapsing these into coefficients obscures the most interesting effects of structure.Thus exchangetheorysuggests that analysisin light of the exchange processes necessarily occurring (e.g. in terms of the interdependencies among the actors) should be more revealing of both the effects of structureand the underlyingpower and influence processes. Exchange theorists have made (and experimentallydemonstrated)at least one importantdiscovery which has had some influence in network analysis. This is the difference between positively and negatively connected exchange networks and their implicationsfor network-conferred advantage(see Emerson 1972b, Cook et al 1983, Yamagishiet al 1988). We referto this structural "8One reasontypes of connectionsor polarityis imporpropertyas "polarity. tant is that for many networks, the distributionof power and influence may depend on the polarity of the network (Cook et al 1983). Thus, Bonacich (1987) modified his earlier(1972) measureof centralityso that it would apply not just to positively connected networks but to negatively connected networks as well (see also Marsden 1987; P. Kappelhoff, unpublishedpaper9). The theoretical reasoning behind the concept of polarity in exchange network theory can contributeto a solution of the debate between structural equivalence (roughly, having equivalentties to the same other actors-from Lorrain & White 1971) and cohesion (roughly, being closely tied to each other) as explanations of the similarity of actors' behavior (e.g. Friedkin 1984, Burt 1987, Erickson 1988, Mizruchi 1989, 1990a, Galaskiewicz & Burt 1991). Cohesion is boundinto the very concept of structural equivalence (Borgatti & Everett 1992). Thus, it is impossible to distinguish structurally between two-step (indirect)cohesion and structural equivalence (M. S. Mizruchi, unpublishedpaper0). Burt (1987) recognizes this but makes it clear that at the heartof the debate is a dispute over the process causing behavioral similarity. Cohesion operatesas an infectious process; structural equivalence operates as a noninfectious process, perhaps through imitation.10 Exchange theory suggests that the two processes are theoreticallycompatible and possible, even within the same network, and that which process is likely to be dominant is itself affected by a structuralproperty, namely, polarity. In a positively connected network, it is probable that cohesion processes will be stronger.The common interestsof the indirectlyconnected
8We introduce a new term here as a shorthandfor types of connections and/or degrees of connectivity. The term can apply either to entire networks (e.g. all relations are negatively connected) or to subnetworks(e.g. some relations are negative and some are positive as in a "mixed" network. See Yamagishi et al 1988.) 9P. Kappelhoff, Power in exchange systems: a new look at the Coleman-modelof collective action, 1990 10M. S. Mizruchi, Cohesion, equivalence, and similarity of behavior: a theoretical and empirical assessment, 1990.

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actors make it likely that infectious processes will lead to similar behaviors (see Laumann& Knoke 1989). In a negatively connected network, however, these infectious processes are not likely, and it is probable that structural equivalence processes will be more dominant (see Mizruchi 1990a). To sum up, network analysis differs importantlyfrom exchange theory in two ways. First, some network analysts claim to use a different individuallevel model, or to use none. However, with the notable exception of biasednet theory, the individual-level models of exchange theorists and network analysts are fundamentallycompatible, if not identical. Second, and most critically, network analysts and exchange theorists tend to view certain aspects of structuredifferently. Their views of what structureis and the relation between action and structure are highly similar. However, they frequentlydiffer in their view of the natureof the ties thatmake up networks. For exchange theorists, network ties consist of exchange relations of valued items, and what matters causally is the exchange value (i.e. due to actors' interests) of the items exchanged. Many network theorists are much more of any exchange of catholic, and allow a varietyof types of ties independently valued items. There is no theoreticalspecificationin network analysis of the as a link between actorsor content of the tie or social relationshiprepresented a line between nodes in a network. Exchange theory suggests ways of constructingalternative,perhapssuperior,explanationsof events within networks and of networkeffects than do some of the more atheoreticalversions of network analysis. Whether the network analysis or the exchange theory position is a more fruitful approach can only be resolved through future empirical and theoretical work.

CONCLUSION
In the past fifteen years there has been a kind of convergenceamong some of the approaches to social structurein sociology. Two generally compatible approachesare exchange theory and networkanalysis. As Collins (1988:412) points out, "These models picture individual actors as both free and constrained.Humanbeings have the capacityto createor negotiatewhateverthey situation, so can at any moment in time. But they always act in a structured and are of their creativity negotiation that the consequences and conditions Moretheir control." beyond relationships nevertheless patternedby larger over, as we have arguedin this review, exchange theory and networkanalysis have similar conceptions of both action and structure.It is true that some network analysts have downplayedany considerationof the individualactor, social structure.Nevertheand some exchange theoristshave undertheorized of structure and action Collins the presents have become fused less, images and are both reflected in recentdevelopmentsin exchange networktheory and in much work in network analysis.

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It is a measure of the progress achieved that earlier statementsregarding what is centralto structural analysis in sociology clearly viewed these alternatives as incompatible (e.g. Blau 1975, Stinchcombe 1975). Nevertheless, further theoretical refinements will be required to flesh out the underdevelopedfeaturesof this emerging general model of social structureand action (see Hechter 1991). In conclusion it is importantto reiteratea point often lost in debates about the relative merits of particular theoreticalapproaches:no single perspective or approach(networkanalysis and exchange theory included) can explain all social and culturalphenomena(see, e.g. Merton 1975). Even the marriageof networkand exchange approacheswould not be able to lay claim to the role of "grand theory" in sociology. Nevertheless, the convergence of these two approachesdoes have the potentialto be broaderin scope and more powerful in explanatorytermsthan eitherapproachalone. For this to happen, however, more work needs to be done clarifyingpoints of useful articulationas well as areas of conflict or mutual exclusivity. Our review chapteris an attemptto initiate this task.
ACKNOWLEDGMENTS

The authors' names have been listed alphabetically. We acknowledge an earlier grant from the National Science Foundation(SES8519319), to K. S. Cook, M. R. Gillmore, and T. Yamagishi, for supportof the developmentof exchange network theory. Literature Cited
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