Reciprocity is a fundamental mechanism for sustained social relationships. Escalation-based theories suggest that reciprocity intensifies over time. In contrast, equity-based theories propose that people reciprocate behaviors in kind. We reconcile these conflicting perspectives by examining social exchanges across different cultural contexts. Using three complementary experiments, we investigate when, how, and why individuals in East Asian settings and those in North American settings differentially reciprocate positive versus negative behaviors over time. Study 1 demonstrated that in positively framed exchanges (i.e., giving) Americans escalated their reciprocity, but Singaporeans reciprocated in kind. However, in negatively framed exchanges (i.e., taking), Singaporeans escalated their reciprocity, but Americans reciprocated in kind. Study 2 replicated the results using Hong Kongers and showed that cultural differences in regulatory focus were associated with specific emotions (i.e., anxiety and happiness), which then escalated reciprocity. To establish causality, Study 3 manipulated regulatory focus within one culture and replicated the pattern of results.