Value Tradeoffs for a Cashless Society

A recent news story (Sunday Times 6 June 2021) highlighted the potential for Sweden to lead the way to a ‘cashless’ future.[1] Not surprising in the context of so many observable trends moving in this direction. However, it reminded me of the early forecasts of a cashless society that were debated in the 1970s, and sense, particularly to the work of my former colleague and pioneer of social informatics, the late-Rob Kling, who died in 2003.[2]

PPRO Colleagues 1979

Early in my research on the social aspects of information and communication technologies, I had the opportunity to collaborate with Professor Rob Kling at UC Irvine, when we were both involved with the Public Policy Research Organization (PPRO), directed by Professor Kenneth Kraemer. I joined this team that also included John Leslie King, Jim Danziger, Alana Northrup, and others, in 1974 to work on the URBIS Project. Supported by the US National Science Foundation, URBIS was one of the first systematic evaluations of the role and impact of computing in American governments.[3]

In 1976, Rob published one of his early critiques of what were then called ‘electronic funds transfer systems’ that pioneered in raising some of the social and ethical issues for society, namely around privacy. Here is the abstract of this piece, entitled ‘Passing the Digital Buck: Unresolved Social and Technical Issues in Electronic Funds Transfer Systems’:

“Over the last decade, plans for using computer-based systems to automate the transfer of debits and credits have moved from a technologist’s pipe dream to an emerging reality. During the last few years, several components of this technology have been developed in prototype form and have begun to be implemented on a large scale. While such systems promise financial benefits for the institutions that exploit them, they also raise significant social, legal, and technical questions that must be resolved if full-scale Electronic Funds Transfer Systems (EFTS) are not to cause more problems for the larger public than they solve. Few of these problems have been systematically articulated. This paper describes the mechanics of EFTS, and the benefits it should provide its promoters. But it emphasizes a variety of the problems that EFTS raises and places them in context.”[4]

Like many others, I’ve followed the development of electronic payment systems over the decades. Three simple but notable reflections repeatedly come to mind from this work. 

One is the degree to which some thoughtful thinkers really can provide valuable forecasts of future developments. I most often find myself marveling at how wrong forecasting can be, but yes, there are some clear examples of individuals, like James Martin, clarifying the social and technical dynamics of likely trends and their future development. Rob’s discussion of the social and value tradeoffs of EFTS is one that we are seeing played out today – 4 decades later. The trick is to sort out the forecasts that are truly prescient as they have a sound empirical basis in the history and underlying dynamics of their development from those that are silly, simply technologically deterministic extrapolations, or based on a limited and possibly misleading example. Of course, even the best of forecasts need to be understood as problematic given the many factors shaping the use and impacts of technical innovations. 

The second is that everyone needs to be skeptical of forecasts as long-range expectations about the future are most often overly optimistic or pessimistic. Even forecasts that are on target are often a decade or two further in the future than originally forecast. Video telephony was forecasted in the 1960s and marketed in the early 1970s but is only recently flourishing. 

The third is the unpredictable fluctuations in these trends. It is not just a straightforward linear, non-linear or slower curve of development, but often entail major perturbations over time. For example, in the case of digital payments, the automated teller machines were an early development that seemed to be a gift that enable a return to privacy. Rather than paying for everything electronically, people tended to get cash from distributed teller machines and therefore be able to make a larger proportion of their purchases privately – using cash. So, surprise – digital systems were enhancing privacy – but only for a time. 

Of course, it became clear that cash withdrawals could be so well tracked that individuals could be followed with considerable accuracy. And today, given the many ways payments and clicks are analyzed online for marketing and advertising, the concept of ‘surveillance capitalism’ has become widely accepted.[5] Moreover, in the context of the global pandemic, individuals have been incentivized to use electronic payments for everything and not to use cash. That brings us full speed ahead into a more truly cashless society with all of the social and political tradeoffs that Rob warned us about in the 1970s. While even Rob could not have foreseen the pandemic and its pressure on moving to a cashless society, his forecasts of the value tradeoffs remain valuable to this day. However, far more empirical research needs to be conducted on the actual development and impacts of our cashless society.

Further Reading

‘The Social Construction of Rob Kling’, The Information Society, 2003, 19: 195-196.

Rob Kling, ‘The Social and Institutional Meanings of Electrnonic Funds Transfer Systems’, Chapter 15 (pp. 183-195) in Kent Colton and Kenneth Kraemer (eds), Computers and Banking. New York: Plenum Press, 1980.


[2] ‘The Social Construction of Rob Kling’, The Information Society, 2003, 19: 195-196.

[3] This research was reported widely, but captured in two books, including Kraemer, K. L., Dutton, W. H., and Northrop, A. (1981), The Management of Information Systems, New York: Columbia University Press, and Danziger, J. N., Dutton, W. H., Kling, R., and Kraemer, K. L. (1982; 1983 paperback), Computers and Politics: High Technology in American Local Governments, New York: Columbia University Press.


[5] Shoshana Zuboff, The Age of Surveillance Capitalism. London: Profile Books.