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Information control as a bargaining tactic in social exchange networks Foddy, Margaret Lynn

Abstract

This dissertation is concerned with the process by which social actors conceal information about the true level of their profits in exchange interactions, so that they may deviate from a norm of fairness calling for equality of subjective profits to the parties in an exchange. Two factors are posited to act as constraints on the potential advantage of information control — a preference by social actors for reliable information that allows comparison with exchange partners; and the availability of alternative exchange partners who do not conceal their resources. In this context, we outline six exchange situations characterized by different distributions of information (symmetric and asymmetric), and by different numbers of alternatives. One case, involving asymmetric information and several alternative exchange partners, is selected as the focus of this study. A theory is constructed to make predictions concerning the nature and direction of initiations of exchange, the perception of advantage in information control, and the likely success of tactics of concealing information about resources from potential exchange partners. The predictions are subjected to test in an experimental study, involving 336 subjects in 42 experiments. The results are largely supportive of the predictions that: 1) people who can conceal their resources make more attempts to gain advantageous exchanges; 2) people prefer to enter exchange transactions in which they have reliable information about their partners; and 3) people direct more initiations of exchange to others who possess relatively large amounts of desired resources. The few cases in which negative evidence arose are evaluated, and attention is drawn to aspects of the theory and experimental design in need of further investigation.

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