There has been a tremendous amount of chatter and no doubt most readers are somewhat familiar with the term, and the practice of the sharing, or peer-to-peer, or gig, economy. For those that are not or just to verify what we are talking about, The People Who Share website has a pretty good description:
The Sharing Economy is a socio-economic ecosystem built around the sharing of human and physical resources. It includes the shared creation, production, distribution, trade and consumption of goods and services by different people and organizations.
Leveraging the Internet to Share
To that I would add this sharing is facilitated and made possible by the Internet and various applications. Increasingly, individuals are reaching out to each other through the Internet where sites and apps connect people seeking services with sellers of those services.
There are task brokers such as TaskRabbit and Fiverr; on-demand delivery services like Postmates and Favor; and grocery-shopping services like Instacart. Among the most well-known services are Airbnb, the short-term-stay broker and of course, the ride-sharing services, Lyft and Uber.
The Sharing Economy: A Shift Away From Ownership is an NPR series – multiple podcasts – that is worth a listen. How the Sharing Economy is Changing the Places We Work is one of the podcasts in the series.
The idea behind these peer-to-peer services is pretty straight forward. Eliminate, or reduce, the middle man by using technology to rent out or share underused personal assets. What could be better than easily connecting people who have an “extra” resource, whether it be a car, an apartment, a car, time or whatever with people who might be lacking those things?
Those who participate as providers are often drawn in by the idea of self-management and stepping outside of the typical hustle and bustle; and the ability to diversify their work life on schedule that works best for them. On the other side of the transaction are those looking to use a resource they do not possess at a reduced cost or because of the convenience.
I don’t have strong feelings for or against these services and I have yet to form a firm opinion about how much they will transform the economy. Some celebrate the idea that this “new economy” will significantly impact the ownership model that has existed since the beginning of time. Well maybe not since the very beginning, but a long, long time.
I’m somewhat skeptical, because of course, someone has to own the resource that is being shared. At some point in time someone had to utilize capital to come into possession of the resource. Additionally, someone will have to utilize capital to maintain the resource. A common criticism of these services, particularly Uber, is that they do nothing more than drive down wages and are not all that helpful – financially – to the people they purport to provide greater opportunity.
My general feeling at this point is that these types of services do offer conveniences for the recipients and they can provide a little extra money for someone looking for a side hustle as another stream of income – either for someone already in retirement or to supplement a primary income – or for a spouse to help add a little to the household income. However, I have my doubts as to their ability to serve as bulwarks against widening income inequality; and the ability provide an income that would lift someone to the middle class and beyond and serve as a replacement for more traditional (boring?) 9-to-5 jobs and the benefits that might come with them.