Tag Archives: Rachel Botsman

The sharing economy

Is the sharing economy changing our modes of consumption? And beyond that, does it herald a new epoch of how we relate to each other and to the world? Is it the beginning of a new and more sustainable economic order as e.g. Rachel Botsman has argued?  Or is it, at best, more of the same and, at worst, a less rather than more responsible form of economic exchange as, for instance, suggested by Ehsan Zaffar? Before seeking to answer these highly charged and normative questions, we should probably take a sobering step back and simply ask: what is the sharing economy?

sharing definitions

Well, you have probably already heard the term plenty of times and you are most likely familiar with many of its specific manifestations. Services like Airbnb and Uber have become globally familiar brand names, but a plethora of more local (or at least smaller) initiatives are also blooming under the sharing economy umbrella: car sharing, redistribution of used clothes, books and the like, knowledge sharing…it seems only our imagination sets the limits. If you can think it, you can share it. But how? The sharing economy operates on the principle of creating possibilities for consumers to either share products or collaborate in processes. Or, in Botsman’s definition, the sharing economy is “an economic system based on sharing underused assets or services, for free or for a fee, directly from individuals.”

While there are some quibbles about definitions – when is something ‘collaborative’, ‘sharing’ or ‘on-demand’? – the basic model of the for-profit participants in this system is to find some way of making money out of facilitating contact between those who have an underused asset and those who need to use it.

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In one sense, there is nothing new or particularly revolutionary about this. After all, libraries are not exactly a recent invention, flea markets have existed for centuries and in some local communities there are long-standing traditions of borrowing from each other, just as ‘housesitting’ was hardly invented by Airbnb. However, because of technological innovations that free peer-to-peer transactions from previous constraints of time and space, the scale and scope of sharing is now greater than ever. The sharing economy, we might say, is the barter society gone online. Thus, what is different is not the act of sharing, but the mode of doing so – and the challenges (as well as the opportunities) this creates for traditional businesses. As an example, traditional players of the transportation industry, e.g. car manufacturers, rental companies and delivery services, are being challenged by new actors who base their business on the sharing model. In response, a number of the traditional companies have adopted sharing initiatives of their own; e.g. BMW forms part of the DriveNow car sharing initiative, Avis has acquired the car sharing network ZipCar and DHL has created the MyWays app that connects people who do not have time to pick up their parcels at a service point with people who would like to earn some money by delivering a parcel to the recipient’s address of choice.

So, is this a new beginning for how we consume, a new economic order? Well, the sharing economy does present new forms of exchange, but these can be interpreted in a variety of ways. As Chris Martin (2016) shows, the sharing economy is currently framed in at least six ways: as (1) an economic opportunity; (2) a more sustainable form of consumption; (3) a pathway to a decentralised, equitable and sustainable economy; (4) creating unregulated marketplaces; (5) reinforcing the neoliberal paradigm; and, (6) an incoherent field of innovation.  Further, big business’ current appropriation of the sharing economy, consumers’ tendency to combine sharing with traditional consumption (and not with less consumption), the controversy caused by Uber and similar events show that there is nothing inherently sustainable in the sharing economy – instead, its effects depend on how organizations and consumers alike make use of the new opportunities it offers.