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As more venues go cashless after the pandemic, ASU experts see downsides

As more businesses go cashless, ASU expert sees data-tracking, privacy issues.
May 11, 2021

Loss of privacy, inequity in banking access are among drawbacks

As businesses and destinations begin to reopen from the pandemic shutdown, consumers will likely see more places going cashless.

Chase Field in downtown Phoenix, home of the Arizona Diamondbacks, will reopen to its full capacity later this month. When the stadium opened to a limited number of fans in April, the team announced a new policy of not accepting cash. Fans use a smartphone app to reserve parking and to order and pay for concessions. Cash is not accepted at the concession windows, parking garages or team shop.

The east entrance of the Grand Canyon, closed for over a year, reopened last month with a policy of accepting only park passes and credit cards — no cash.

Going cashless will not be a major inconvenience for people who already use their debit or credit cards almost everywhere, but it does raise some issues regarding privacy and equity, according to two Arizona State University experts.

“It’s more hygienic because there’s less contact and you’re not sharing bills and change,” said Geoffrey Smith, clinical associate professor of finance in the W. P. Carey School of Business at ASU.

“Things have been heading toward cashless, but this is a good time for businesses to roll it out, when consumers are more accepting of it under the guise of safety.”

Also, businesses don’t have to deal with hiring armored cars to transport large amounts of cash.

Some businesses accept digital payment services, like Apple Pay, Smith said.

“I think that’s the future, where you use your phone and get rid of the cards,” he said. “People like the speed and convenience and the accurate record keeping.

“You can go out to dinner and split the bill right at the table on everyone’s phones.”

In addition, Smith sees even brick-and-mortar retail sites adopting cashless policies.

“Some places are trying to get rid of cash registers in stores by moving toward a kind of shopping where you put your item in the cart and it’ll just charge you right then,” he said.

The Amazon Go and Amazon Go Grocery stores use this method, where there are no checkout lines.

“It saves space and frees up labor,” Smith said. “Retail needs to compete with the online experience, so these types of instantaneous payments allow retail to be more competitive.”

But he sees some people preferring to use cash for privacy reasons.

“There is a loss of privacy. All of your transactions are now electronically tracked, and people can tell where you were, how much you spent and what you bought,” he said.

As consumers’ purchases add up, the data can be mined for more personal information.

“For example, if you go to the same place every day for coffee, a company can infer that you work in that area because you’re there 200 days a year at 8 a.m.,” he said.

But the move toward cashless transactions raises issues of equity, because low-income people are less likely to have accounts with traditional banks, according to Debra Radway, a lecturer in the W. P. Carey school and a certified financial planner.

“A lot of the banks have requirements for minimum balances, they have overdraft fees and they have a lot of fees in place that make it cost prohibitive for a low-income person to have an account at a traditional bank,” she said.

“With larger institutions, they usually have a minimum amount you have to keep in your account or you have to have one direct deposit going in to waive the fees.”

A traditional bank’s fee for an overdraft could be $40 or $50, she said, although credit unions typically charge less.

Banks are for-profit companies and make money from fees and from the large balances carried by customers, which they can lend out, charging interest.

“They do have a requirement they have to be in underserved communities, but as a general rule, banks are focused on making a profit so they’re looking for the most profitable customers,” Radway said.

A 2019 survey by the Federal Deposit Insurance Corporation found:

  • 5.4% of households, about 7.1 million, in the U.S. were “unbanked,” with no checking or savings accounts.
  • The percentage is much higher for Black households, 14%, and Hispanic households, 12%.
  • Unbanked households said the main reason is because they don’t have enough money to keep in an account.
  • About 7% of unbanked households had a credit card.
  • Two-thirds of unbanked households reported that they pay bills in cash, according to another FDIC survey conducted in 2017.

Being unbanked doesn’t mean avoiding fees, though.

“If you’re low-income and you don’t have a checking account and you get paid with a check, you have to pay an extra charge to cash that check,” Radway said.

“If you want to look at who’s serving the poor, it’s the check-cashing companies and the payday loan companies. When poor people live paycheck to paycheck, they run short and have to take out short-term loans and wait until their next paycheck comes in to cover it.

“Those tend to have high annualized fees, but if you don’t have an account, you don’t have a choice.”

Not everyone is embracing the cashless trend. Last year, New York City joined Philadelphia and San Francisco in banning stores from going cashless because of the equity issues, specifically the difficulty that homeless and undocumented people would face in acquiring bank accounts.

Some venues are acknowledging that many consumers still use cash. At the Staples Center in Los Angeles, where the Lakers play, the concessions are cashless but fans can use “cash-to-card” kiosks in the arena to convert dollar bills to prepaid cards with no fee.

Radway said that other countries, such as China, use digital wallets that are not attached to bank accounts.

“It will be interesting to see how we evolve toward payments on our phones without cash,” she said.

“These fin-tech companies are offering banking-related services and allow you to move money around without a bank.”

Top image courtesy of

Mary Beth Faller

Reporter , ASU News


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Researchers call for new effort to understand ancient cities and sustainability

May 11, 2021

Why do some human settlements endure the test of time, while others do not?

The modern, industrialized society is not how humans have always lived.

In fact, the last 200 years make up only a tiny portion of human history.

An interdisciplinary team led by Arizona State University researchers is calling for a focused research effort to understand why some human settlements endure the test of time (for thousands of years, in some cases), while others do not.

The researchers published their call this week in the Proceedings of the National Academy of Sciences describing a lack of analysis in this area, called settlement persistence. Settlement refers to any place where humans live and interact — including cities, towns, villages and even hunter-gatherer camps.

The authors pose three possible factors that determine how long a city prospers, including population size, institutions that create cultural norms and physical infrastructure, and the surrounding natural environment.

While much of this raw data exists, the authors call for an in-depth analysis of settlement areas around the world over thousands of years. This is a massive undertaking, as data first needs to be standardized before it can be used for further analysis, like creating models to simulate trajectories of current human settlements.

At first, one may not see the urgency in learning about the dynamics of a long-gone city. The researchers argue that organized, quantifiable data on human settlements throughout deep history and recent history can help us better understand urban sustainability today.

A figure depicting settlement persistence

Figure 1 from the paper, showing the length of occupation of some premodern settlements. Ebla and Athens started in a similar physical location at a similar time. So why did Athens endure as Ebla fell? Similarly with Beijing and Xi’an. What made Beijing different from Xi’an? Reprinted with permission from Smith, et al., PNAS (2021).

What is urban sustainability?

Sustainability generally refers to the ability for something to carry on and continue. In what ways do our modern settlement areas operate sustainably? Are some more sustainable than others?

Cities are typically thought of as massive and strong. Able to support thousands, sometimes millions of people, they are well-developed and established.

However, the ever-changing human landscape is constantly presenting human settlements with new challenges. Perhaps the year 2020 has made many think twice about the stability of the places where we live, work and interact. Will the cities and towns we know today still exist in 100 years? In 1,000 years?

“Fundamentally, sustainability is about humans coexisting in an environment for generations,” said co-author Abigail York, associate professor in the School of Human Evolution and Social Change, who studies environmental social science and urbanization. “Sustainability means that the underlying ecosystem integrity is maintained and people thrive with reduced injustice and inequity. Modern, Western societies (like ours) fail in both dimensions.”

Video by Steve Filmer/ASU Media Relations and Strategic Communications

What do we know so far?

Not only does much of the raw data on past settlement demography, institutions and geography already exist, but there is also anecdotal information that can help set the stage for continued analysis.

Lead co-author and archaeologist Michael E. Smith, a professor in the school, noted some researchers draw similarities between the ancient Maya civilization and many modern societies, though this is not particularly useful from a scientific perspective.

For example, right before the Maya collapse, there was a distinct separation of the Maya elite and the commoners. The elite members of society were not behaving in a way that was sustainable for everybody. Some see a similar situation panning out in modern societies.

“While this does prompt us to think about things, it doesn’t really provide any kind of rigorous, scientific background for comparison,” Smith said. “So, we need to have the kind of quantifiable data that an urban sustainability scientist will be able to understand and use.”

A visualization of the three main determinants of settlement persistence. It’s Figure 4 from the paper. Reprinted with permission from Smith, et al., PNAS (2021).

The authors note Rome as a well-studied example of settlement persistence and resilience theory.

Two thousand years ago, the city of Rome was a metropolis — thriving with a population of approximately 1 million people. Through political shifts, pandemics and invasions, the population fell to approximately 30,000. But, over hundreds of years, the population grew again and today there are about 3 million people living there.

Resilience theory prompts questions like why do settlement areas “bounce back” after a major disruption like extreme weather or war, while others do not?

A complete picture is needed

The authors, experts in their respective fields of urban sustainability, economics, archaeology, ancient cities and geography, note the importance of this research. They say that many scientists in the field recognize the value of understanding the past, but there aren’t many concerted efforts to organize and analyze the thousands of years of archived data.

The authors say human settlements of today will need to adapt. They’ll need to adjust for climate change. What will coastal cities look like in 50 years? Understanding how humans have responded to climate change events in the past may be a good place to start.

“Ignoring the diversity of human experience and history is a flawed strategy,” York said. “Particularly as it is increasingly clear that the status quo, the dominant modern, Western approach, cannot solve today’s urban sustainability challenges.”

“The Persistence of Ancient Settlements and Urban Sustainability” published in PNAS volume 118 in May 2021. The paper was co-authored by Arizona State University researchers from the School of Human Evolution and Social Change and the School of Sustainability, including SmithJosé LoboMatthew PeeplesYorkBenjamin StanelyKatherine Crawford and Angela Huster, and University of Arizona researcher Nicolas Gauthier.

Taylor Woods

Communications program coordinator , School of Human Evolution and Social Change