Responses to common criticisms of micropayments

I’ve been continuing to research micropayments since my last post. I’ve been seeing some tired arguments repeated over and over, but have seen relatively very few challenges to them. Here’s why the most common arguments against micropayments are probably wrong.

There is no evidence supporting the existence of “mental transaction costs” related to micropayments

Nick Szabo as early as 1996 argued that there were mental barriers to people using micropayments, and then reiterated that point a few times (1999, 2007, 2015). Clay Shirky made similar noises as earliest as I can tell in 2000, then again in 2003.

What can be asserted without evidence can also be dismissed without evidence.
Does this man look like he’s suffering from the cognitive exhaustion of mental transactions costs after paying a small amount of money to play this game?
Tools for disciplining children using cognitive exhaustion?
Cognitive exhaustion torture machine?

Micropayments will encourage people to purchase content from sources they support or agree with, that will be a good thing

Both Alec Bostwick and Will Federman have mentioned (here and here) the results of a 2013 study from the University of Tennessee showing that in a hypothetical micropayment system people are more likely to pay to view news articles from sources they agree with. This isn’t surprising to me, and it’s strange to me that it’s couched as a micropayment counter-argument.

Advertising, subscriptions and micropayments are not mutually exclusive

As Walter Isaacson put it in Time magazine back in 2009:

People may search for free alternatives of content that requires a micropayment, but they will like the affordable options more

You’d think if there was a study showing people have a tendency to want to pay news sources they agree with when they have the ability to use micropayments, maybe they also wouldn’t want to cheat those sources? But maybe some people really can’t afford it, maybe some people think cheating is cool or stealing is fun.

There are viable micropayment platforms in use right now

Aside from the specific use cases mentioned above, there are currencies and distributed applications ready to do micropayments right now. In my current order of preference:

See also

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