7 The Rise of the Sharing Economy

Question 1

What is Sharing? What does the term sharing economy refer to?

Answer 1

• Sharing involves the act and process of distributing what is ours to others for their use and/or the act and process of receiving or taking something from others for our use
• The term sharing economy refers to peer-to-peer based sharing of (access to) goods and services

Question 2

Why does Belk (2014) refer to some business models, as e.g., car-sharing as “pseudo-sharing”?

Answer 2

• Pseudo Sharing: paid business models of the sharing economy use the terminology of sharing but are more accurately short-term rental activities

Question 3

Please distinguish between the allocation mechanisms pure gift-giving, reciprocity, and market-exchange. How can you categorize business models of the sharing economy using this schema? Please use the examples of Couch-surfing and AirBnB.

Answer 3

• Pure gift-giving: an objec is transfered from one individual to another without the expectation of reciprocation
• Reciprocity: exchange of goods between people who are bound in non-market, non-hierarchical realtionships with one another. the exchange does not create the relationship, but rather is part of the behavior that gives it content
• Market exchange: exchange of goods at prices determined by the law of supply and demand. its essence is free and casual contract

Question 4

In how far would you say that the sharing economy broadens the scope of existing mechanisms of exchanging value?

Answer 4

• currently: rely almost entirely on dollars to transact with each other
• business models of the sharing economy are something in between reciprocity and market exchange
• new exchange mechanisms due to the sharing economy:
  
  • transfer of ownership versus access over ownership
  • paid versus unpaid

Question 5

Discuss: Is the sharing economy merely a new way of renting, facilitated by the internet?

Answer 5

• yes, it is. For example whyown.it aimed at being a platform to exchange things without platform, but it failed because of a lack of demand
• Fred Wilson sums it up with the following words:

“The sharing economy was outed as the rental economy. Nobody is sharing anything, people are making money, plain and simple. Technology has made renting things (even in real time) as simple as it made buying things a decade ago. Uber and Airbnb are the big winners in this category but there are and will be others.”

Question 6

What is meant by a conflict of social and market norms? Could such a conflict of norms occur in the sharing economy? Which threatening development does Michael J. Sandel describe in his book “What money can’t buy – the moral limits of markets”?

Answer 6

• The conflict might occur if market norms (selling/ paying/ compensating) are applied in a social setting (helping/ sharing)
• M. J. Sandel:
  
  • fewer and fewer things that money can’t buy
  • market.incentives are used to solve social problems
  • from market economy to “market society”
  • market values reach into spheres of life previously governed by social norms and values

Question 7

What do you think: could business models like AirBnB and Uber lead to an erosion of social norms of helping and sharing?

Answer 7

I wouldn’t call it erosion, but yes, in my opinion, these models will definetly change the social norms of helping and sharing. But i don’t think that we can say yet if the social values will disappear or just change in some way.

Question 8

Which drivers of sharing are typically discussed?

Answer 8

• technological innovation (web 2.0)
• economic realities (economic crises)
• values shift (relationships)
• environmental pressures (sustainability)

Question 9

Which motives of participation in the sharing economy do Hamari et al. (2015) propose and test?

Answer 9

• sustainability
• enjoyment
• reputation
• economic benefits

Question 10

Which levels of implementation of the sharing economy can de differentiated? Please name one example for each level.

Answer 10

• Building relationships (casual, spontaneous, one-time)
• Building agreements (regular exchange)
• Building organizations (e.g. libraries)
• Building larger-scale infrastructure (e.g. bike-sharing programs)

Question 11

Which mechanisms are used to ensure trust and accountability in the sharing economy?

Answer 11

• reputation of a social entity is an opinion about that entity, typically a result of social evaluation on a set of criteria
• digital reputation serves as a mechanism of social control
• “technology is reinventing new forms of trust”

Question 12

Please name three arguments for and three arguments against business models like AirBnB and Uber. What do you think – do the pros or the cons prevail?

Answer 12

• Pros:
  
  • more efficient use of resources
  • cheaper prices for consumers
  • trust-enhancing effects
  • improved services
  • increased economic entrepreneurship
• Cons:
  
  • destroying existing business models
  • unfair competition
  • safety risks due to lack of unsurance
  • undermining employment laws
  • benefiting from tax loopholes