Business Growth
Shared Economy: Collaborative Consumption and Rewriting the Rules of Ownership
March 27, 2024

Shared Economy: Collaborative Consumption and Rewriting the Rules of Ownership

In recent years, a phenomenon known as the shared economy has disrupted traditional notions of ownership and consumption. Collaborative consumption has emerged as a powerful force, reshaping industries and challenging established business models. The shared economy empowers individuals by transforming them from passive consumers to active participants. People are no longer limited to being mere buyers; they become contributors and providers, leveraging their assets and skills to generate income and create value for others. 

WHAT IS SHARED ECONOMY?

A sharing economy can be described as an economic model in which goods and resources are shared by individuals and groups in a collaborative way such that physical assets become services. The sharing economy’s growth has been facilitated through advances in big data and online platforms.

Advantages and disadvantages

How did the shared economy Concept come to be?

  • The digital boom
  • Low growth prospects
  • Environmental worries, which are increasingly pressing
  • The lack of confidence in institutions
  • The renovation of relationships with property
  • The desire to position the individual at the center of society.

 

Examples in the Shared Economy

Uber

Uber revolutionized the transportation industry by introducing ridesharing, allowing individuals to use their own vehicles to provide rides to passengers through a mobile app. It operates as a platform connecting drivers with passengers, offering a convenient and cost-effective alternative to traditional taxi services.

Airbnb

Airbnb transformed the hospitality sector by enabling individuals to rent out their properties or spare rooms to travelers for short-term stays. Through its online marketplace, Airbnb connects hosts with guests, providing a diverse range of accommodation options and fostering a sense of community and cultural exchange.

TaskRabbit

TaskRabbit is a platform that connects users with freelance labor for various tasks, such as household chores, errands, and handyman services. It allows individuals to outsource tasks they don’t have time for or need assistance with, while providing opportunities for freelancers to earn income on a flexible basis.

Instacart

Instacart disrupted the grocery industry by offering on-demand grocery delivery services. Through its platform, users can order groceries from local stores and have them delivered to their doorstep by Instacart shoppers. This model provides convenience and flexibility for consumers, while also creating earning opportunities for shoppers.

Poshmark

Poshmark is an online marketplace and social platform for buying and selling new and pre-owned clothing, shoes, accessories, and home goods. Launched in 2011, Poshmark has grown into one of the largest and most popular platforms for fashion resale, with millions of users across the United States and Canada.

Rover

Rover is a platform that connects pet owners with trusted pet sitters, dog walkers, and other pet care services. Launched in 2011, Rover has become one of the largest and most popular platforms for pet care services, serving millions of pet owners across the United States and Canada.

IMPACT OF SHARING ECONOMY

  • Transportation: Uber offers cost-effective, comfortable, and safe rides, challenging conventional transit options.
  • Consumer Goods: Platforms like eBay provide convenience, affordability, and efficiency in purchasing goods through peer-to-peer transactions.
  • Personal and Professional Services: Freelance platforms revolutionize access to skilled services, from accounting to plumbing, offering flexibility and expertise.
  • Healthcare: While still emerging, the sharing economy is expected to transform healthcare, offering innovative solutions like telemedicine and group consultations.

 

Regulation and Government Oversight

Criticism of the sharing economy often involves regulatory uncertainty. Many of the services offered on these platforms are intended to replace industries that are highly regulated by federal, state, or local authorities, for example, taxicabs and hotels. Individuals offering short-term rental services may not be following government regulations or paying the fees. This could allow them to charge lower prices. It also opens the door to incompetent and even unscrupulous competitors.

The lack of government oversight can lead to a risk of serious abuses of buyers and sellers in the sharing economy, such as a lack of privacy or the unfair treatment of contractors. Even when laws are in place to regulate sharing platforms, those laws are not always followed.

 

the sharing economy affect on the environment

As well as transforming business models and allowing consumers more choice and more power, the sharing economy has some important advantages for the environment too. These are just some examples of the impact it has:

  • Sustainability: The exchange of goods and services between consumers means we buy fewer items overall. This means there is less of a need to manufacture new products – cutting pollution and waste across the whole supply chain;
  • Reducing use of natural resources: We need to make a collective effort to stop using the world’s natural resources and damaging the environment, for example, cutting down trees. The sharing economy means we put less pressure on these resources and allows us to better protect our environment.

 

Challenges the Sharing Economy face

  • Regulatory Lag: The phenomenal growth of the sharing economy, estimated to reach $3.3 trillion USD by 2025 according to the World Economic Forum, has outpaced regulatory frameworks. This creates conflicts with established industries, particularly in areas like transportation and accommodation.
  • Precarious Worker Protections: Gig economy workers, a significant component of the sharing economy workforce, often lack essential social safety nets. A 2023 International Labour Organization (ILO) study revealed a concerning statistic: 70% of platform workers globally lack access to social security protections.
  • Consumer Trust Concerns: Building trust is paramount for the long-term viability of the sharing economy. However, consumer confidence can be eroded by issues like fake listings, unqualified service providers, and data privacy breaches. A 2023 Consumer Reports survey identified these very concerns, with 42% of respondents expressing worries about fraudulent listings and scams, and 38% voicing anxieties about data privacy violations. Addressing these issues is crucial for ensuring a safe and reliable experience for consumers within the sharing economy.

 

Sources

admin
0