The Revolution of the Practice of Payment


Essay, 2012

17 Pages, Grade: Distinction


Excerpt

The categories of real and symbolic, material and meaning have for a long time bothered not only cultural theorists but also prominent philosophers (e.g. Hegel, 1979; Heidegger, 1978) and sociologists (e.g. Baudrillard, 1983, 1993). Often the relationship between the two has been characterised in terms of ‘opposition’, ‘contrast’ or ‘incompatibility’. It can, however, be argued that this theorizing has – at least in cultural theory which is the strand of discourse that is dealt with in this paper – been replaced by a ‘unity’. More precisely, it is practice theory that has in several ways overcome the opposition and replaced it with an ‘inclusive view’ (e.g. Reckwitz (2002); Shove&Pantzar (2005)).

Going beyond the debate of ‘practice theory’ in its different forms (comparing for example Bourdieu with Schatzki) and also exceeding the comparison of practice theory with other forms of cultural theory (see Reckwitz (2002) for an overview), this paper will make two arguments: First of all, if we focus on the more recent forms of practice theory (what Postill (2010) calls the ‘second wave’), it is indeed possible to abolish the above oppositions in favour of an inclusive notion of practice regarding material and meaning. We will try to provide a common theoretical understanding of practice in this contemporary sense in the first part of the following essay. Secondly, the main part of this paper consists of an applied case study, the ‘Revolution of the Practice of Payment’. We follow the approach developed by Shove and Pantzer (2005) towards Nordic walking in order to depict the development of payment practices from coin and paper to plastic money. In the course of this exemplatory analysis special emphasise is placed again upon material and symbolic characteristics that are seen not as opposing but rather intertwined features of practices. As will therefore be shown both in theoretical and applied terms, practice theory can abandon contrasting notions of materiality and meaning.

In the last chapter of this paper, however, we will debate the notion whether it should do so. In this critical part, we will take into account arguments formulated on the one hand from material culture studies and on the other from language and representation studies in relation to payment practices in particular. Without questioning the general claim of practice theory, we show two alternative ways of describing payment. On the one hand we argue in the tradition of Shell and Baudrillard that payment became already with the advancement of paper money inherently immaterial and symbolic, whereas following Miller’s material studies on the other hand, payment will always be deeply linked to materiality – even in its most immaterial forms.

Practice theory – an overview of the ‘Second Wave’

It is not the focus of this paper to give an overview of practice theory as was mentioned above. The goal is rather to make the theoretical claim that there indeed exists a theory of practice that has abandoned the opposition between materiality and meaning. In more detail, we will consider the work of Warde (2005), Shove and Pantzar (Shove&Pantzar, 2005; Pantzar&Shove, 2005), as well as Reckwitz (2002) and Schatzki (1996, 2001) as the ‘backbone’ of this theory and present an inclusive account as related to both body and mind and material and symbol.

Body & Mind

First of all, "practices are routinized bodily activities" and in this way a "product of training the body in a certain way" (Reckwitz, 2002:251). The body is not a "mere instrument, which the agent must use in order to act" (Reckwitz, 2002: 251) but the crucial ‘site’ of the practice and in this way of the social. On the other hand, every practice also involves the mind: practices require the ‘mindful’ understanding of the individual for a meaningful engagement (Schatzki, 1996:101f). The body cannot move without a deeper knowledge about the routine; a practice can only be performed as interplay. In this way practices involve ‘understandings’ as well as ‘bodily routines’, they are not to be seen in different realms in the practice world. The two features of ‘thinking’ and ‘acting’ are ‘united’ within the performance of a practice. This is the first notion of inclusion.

Objects & Meanings

The second and for this paper more important notion of inclusion can be found in the duality of materiality, objects or things and knowledge or meaning. Following Reckwitz (2002: 252), "objects are necessary components of many practices"; he continues that "carrying out a practice often means using particular things in a certain way". For the individual that understands and performs a practice, the act is first of all dependent on the ‘stuff connected to it’ (Schatzki, 2001). On the other hand, "specific social practices contain specific forms of knowledge" (Reckwitz, 2002: 253), a specific way of shared understanding concerning the objects and also the practice itself. There is always something ‘immaterial’ involved in the performance of a practice. You need to know what you are doing while you are doing it. Schatzki (2001:3) claims that even the understanding itself “always involves apprehending material configurations” and that "things are centrally and unavoidably implicated in the production and reproduction of a practice". Practices therefore, “exist as sets of norms, conventions, ways of doing, know-how and requisite material arrays” (Pantzar&Shove, 2005: 215). Analysing a practice we need to see exactly this “links between the symbolic content and the material content“ (Jalas, 2005), the integrated and interrelated objects, competencies and symbols at the same time (Schatzki, 1996).

Performance

After the above notions of inclusion[1] forming the core of our theory of practice, it is important to stress a third characteristic, namely performance. According to Warde (2005), practices evolve only through people enacting and reproducing them. In a similar vein, Reckwitz (2002) claims that individuals are the 'carriers' of practices. Practices are constituted in an act of performance, individuals participate in them and turn them alive. A practice is not given, not a ‘thing out there’, but exists as a practice through ‘living in and through it’. Following Reckwitz's example, football would not exist if people did not play it. Gomart and Hennion express the same notion in the following way: “a concert or art exhibition does not only unite already existing objects, subjects and social groupings […] – rather, this is a conjunctural event in which the relevant objects, subjects and social groupings are co-produced” (Gomart and Hennion 1999: 228). We are always at the same time creating the practice, performing it, as well as created in it. As Pantzar and Shove (2005: 216) note: “On one side of the coin, practitioners are 'captured' by practices that make demands of those who do them. On the other side of the coin, practices are constituted through participation and defined by the activities of those who 'do' them.”

Summary

To sum up the above, we can define a practice as “a routinized way in which bodies are moved, objects are handled, subjects are treated, things are described and the world is understood." (Reckwitz, 2002: 250). In their “regular, skilful performance” (Reckwitz, 2002: 251), a practice hold the different elements – “forms of bodily activities, mental activities, things and their use, background knowledge in the form of understanding, know-how and notions of competence, states of emotion and motivation knowledge” (Hand et al., 2005) – tightly together.

In this paper, a further feature of practices is of importance that was put forward by Warde (2005). He places special emphasize on the history of practice: "practices have a trajectory or path of development, a history" (Warde, 2005: 139). Important case studies that work with exactly this notion of practice as an ‘inclusive theory of history’ can be found in the most recent literature (Shove&Pantzar (2005), Valtonen (2005), Jalas (2005), Hand et al. (2005)). In the following part, we want to follow a very similar approach and narrate the revolution of the practice of payments in four phases from coins and notes to plastic money.[2] The leading goal in this ‘practical application’ of the above theory is to explicitly focus on the inclusion rather than the opposition between materiality and meaning in order to show that practice theory is a possibility to abolish these contrasts.

The Revolution of the Practice of Payment

Scene 1

December 1380. London. 8 o clock on a Thursday morning. I am on the farmers market in the town centre surrounded by market criers praising their fresh food and clothes. Cackling, mooing, mowing – I can not only hear the unsettling sounds of the cattle next to me, but feel their half-frozen excrements and bowels under my feet. Eased by the heavy coins in my pocket, I approach one of the chatting merchants. Potatoes, carrots, cabbage, a piece of pork – it is not much that you can get in wintertime and this little is most expensive. Two half-guineas with the head of George III change their owner – only three are left for this week in the tinned box.

Scene 2

Late August 2010. Jersey, Channel Islands. 2am on a Sunday. In the very warmth of my home. The only remaining sound this late at night comes from the open fireplace opposite my rest on the sofa. My computer on my lap, I always start with Amazon (especially by the end of the month – I love my credit card). Originally on search for books that are not available at the local library, I end up finding not only a first edition of Edgar Allen Poe’s ‘Gold Bug’ on the net, but order several shirts and a new desk light. Thank you, flexible friend!

Framework – A short historical overview

The development of payment practices can be presented in four stages. The first phase as depicted in Scene 1, was dominated by the metal coin. Coins as a means of payment were originally introduced by the Lydians (Galbraith, 1975), but became a standard essentially by the Romans and the European rulers (Davies, 2002: 64). Payment in the west entered a second phase with the advancement of banking, credit and trade essentially in Italy in the early 17th Century as bank-debt-notes. The government itself introduced its first gold-backed paper moneys in America after 1690 (Galbraith, 1975: 51ff) turning money into a ‘money of account’, a “claim to a specified volume of commodity money held elsewhere” (Leyshon&Thrift, 1997:13). This link to precious metals, especially gold, did not change until after WW II (Davies, 2002: 375ff). Then, money was for the first time decoupled from commodities and in this way “an activated double book entry, a spontaneous acknowledgement of debt that is no longer a commodity" (Leyshon&Thrift, 1997:20). In this third phase, the pure form of paper money was born. We are still part of the coin and paper money phase, but payment is increasingly handled with plastic money (Ritzer, 1995, 2001). In the virtual world of bank accounts and debit cards, it is possible to say that money reached a fourth stage that we tried to illustrate in Scene 2 (Evans&Schmalensee, 2005:27). These four stages will serve as a framework for the following description of the revolution of payment practices.[3]

Materiality

One might say, that material is decreasingly important in the practice of payment looking at the development from stage one to four. At least on the surface, this is one narrative of the revolution –‘dematerialisation’ (Leyshon&Thrift, 1997:22). Although it is generally necessary to note that we are still handling the more material forms, namely coins and paper, the argument stresses the development towards dematerialisation. Within this analysis, it is first of all necessary to look at the materiality of the means of payment – money – before we will comment on its ‘auxiliaries’.

Materiality plays a crucial role when paying with coins and commodity money in particular. Here, material is the inherent denomination of value. (“Eased by the heavy coins in my pocket”). Materiality in this form of payment is thus crucial for the actual act, it makes the means of payment valuable. Already with the invention of the note, one can argue, we arrived at dematerialised money and payment. Instead of gold ingots or coins, it was since then possible to make a payment handing over a slip of paper making a promise, a bank or government note. These first notes however were still linked to a deposit of gold by the bank or the state – they were what Rotman (1986) calls a ‘convertible currency’. Materiality was to a certain extent still there – negligibly in the paper form of the note itself and more decisively as gold in the background. After this gold standard, the crucial form of materiality was lost. Notes became mere notes, and as will be described below were ‘declared legal tender’ by the authority (‘act of Parliament’). This can be seen as the second stage of dematerialisation of the practice of payment. With the arrival of plastic money after 1980, a further level of dematerialisation was added. Payment was possible even without notes or coins, but solely with a bank, a debit or credit card – plastic money. The now prevailing materiality became the ‘plastic card’ (“flexible friend”) and with it a magnet strip, a chip or in the case of the credit card mere numbers. This is arguably the third level of ‘dematerialisation’ after notes linked to commodities and inconvertible notes.

[...]


[1] Actor Network Theory with its questioning the priority of the social over the non-human is another important of those notions of inclusion in practice theory that has been excluded from this paper but is worth further arguments (see for example Law (1999), Akrich (2000: 206), MacKenzie & Wajcman (1999: 23)).

[2] Unfortunately, we will in the course of this paper not be able to re-tell the history of payment practices since its beginning with barter and will also not be concerned with what is often called B to B transactions. The analysis is focused on consumption in form between consumer and a merchant/business. For the clarity of the argument, we furthermore need to exclude any kind of bank transfer from the argumentation. Our analysis is limited to different forms of monetary payments.

[3] As the argument will proceed, we will sometimes treat phases 1 to 3 together in contrast to phase 4 (see ‘Institutions’) or look at every phase separately (see ‘Materiality’).

Excerpt out of 17 pages

Details

Title
The Revolution of the Practice of Payment
College
London School of Economics  (Sociology)
Course
Cultural Theory
Grade
Distinction
Author
Year
2012
Pages
17
Catalog Number
V187366
ISBN (eBook)
9783656114048
ISBN (Book)
9783656113485
File size
534 KB
Language
English
Tags
Real, Materiality, Money, Practice Theory, Payment, Credit Card, Coins
Quote paper
Johannes Lenhard (Author), 2012, The Revolution of the Practice of Payment, Munich, GRIN Verlag, https://www.grin.com/document/187366

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