Diffusion of Innovation: Is Paper Money Becoming Outdated?

 

Money is at the center of everything we do. We are educated for 12 plus years in the hopes of getting a job that can fulfill our basic needs. Everything we do revolves around money. But how did we come to a point where we placed our worth around the value of a piece of paper? Relating the invention of paper currency through the lens of the Diffusion Theory, it is clear that the timeline of paper currency is spread out longer than most inventions and ideas would be. 

Paper currency was one of the biggest inventions to date because it changed the way we conduct things. Originally, humans would trade various objects to get what they wanted. This caused lots of inconsistency and the trading business had plenty of problems. 

The pioneers of paper currency were the Chinese. The first real use of paper currency popped up in the 11th century during the Song Dynasty. This was the innovators part of the diffusion of innovations. Only one part of the world was actively using this invention.

Pictured above is Jiaozi, which is the world's earliest form of paper currency

Since paper currency is a harder innovation to tackle, the early adopters, early majority, and late majority is hard to pin down. People saw how amazing it was in China and it spread throughout the Mongol Empire until it finally reached the United States in 1775. Yes, there is SO many years in between the origin of paper currency until 1775. The point is that paper currency was so innovative and useful that it keeps reaching its peak for years to come. Since we still have access to it and it is still prominently used today all over the world. 

What I can argue is that we are now finally reaching the laggards stage of this innovation. For years and years after the invention of paper currency, there was no other alternative. When people payed for things, they used paper currency. However, with the invention of credit and debit cards it is rare to see people pulling out cash to pay for something. It is pretty hard to tell for sure since paper currency is still used, but with digital forms of cash becoming more and more popular, I am willing to bet that when we look back at this time period years from now we will see that we are amongst the laggards of paper currency. Paper currency was an amazing invention and is still somewhat useful today, however, it is being severely overshadowed by paperless options of currency.

Today, my blog post was probably unconventional compared to others on this topic. However, I wanted to take this opportunity to apply this theory to an invention that is still relevant to the lives of everyone.