“What’s mine is yours, for a fee”
Economists worldwide see the importance of the sharing economy and its impact on the future development. According to the Financial Times (2016) , China is even trying to include the sharing economy’s results in calculating the growth rate, quoting – “to more accurately reflect the new economy”.
Even new words are created to describe the processes in the sharing economy, such as Uberisation , which comes from Uber’s brand name. The word, according to the Cambridge Dictionary, means “to change the market for a service by introducing a different way of buying or using it, especially using mobile technology”.
The definition of the sharing economy is quite interesting. It is defined as the digitally connected economic activities. (Schor et al., 2014). It uses underused resources and help individuals or companies to use them by minimizing transactions costs and use the resources more efficiently.
Evolving technologies made it easier to develop the concept of sharing economy.
Sharing economy could be easily understood by examples. As individuals, while on vacation, we rent an apartment on airbnb, we use Uber Taxi to go from the airport to the rented apartment, we shop online, use internet banking when we do not have time to go to the bank, we use the help service around the neighborhood on taskrabbit, etc.
Freelance workers could also be seen as the players in the shared economy. As a student I was registered at a web site, which connected freelancers to the “just-in-time employers”. I got the chance to write several articles on different subjects, like insurance in different regions, educational gaps in developing countries, etc. There were also options to receive a freelance project on a market research, etc. I did not have to meet the employer and the job was done by e-mail or by uploading documents on web-pages, instead I received money on the credit card. I had free time and used it to make extra pocket money, I was the agent and the principal was, for example, a busy marketing manager of a company, who could not find time to make marketing research and had limited budget.
Technology makes it easier to minimize transactions costs and use sharing economy’s benefits. You can solve problems using your smart phone, shop online, rent a car, etc. Developed technology helps you book the holiday online, avoiding agency costs. It helps individuals, like me for example, to share underused resources – my time, my apartments when I am on the holiday or attending the workshops in Manchester, sell unwanted staff online, use another person’s property, car or time when I have higher opportunity costs. I travel a lot during the whole year in different parts of the world, I book the tickets online, using Turkish Airlines mobile application, book an apartment on airbnb, use Uber to get from the airport to the apartment, I use the shared economy to use the help to leave my pet to other pet owners.
There are some disadvantages of the sharing economy, which should be carefully analyzed. For example, there is a trust issue – you buy a used Gucci bag on e-bay but do not have the guarantee to receive the original bag, not a patent. Sharing economy helps citizens to avoid paying taxes, which is an advantage for the individuals, because of the lower price, but is the disadvantage for society and the country. It is easier to avoid the regulations that is why Uber has problems in the courtroom in several countries, because the service does not meet the necessary regulated terms.
To sum up, we agree, that technology helps individuals to use and reuse unwanted resources, spend less, save time, develop new businesses, innovate, have an eye on market flow and catch the new trends on consumer needs and behavior.
Without technological achievements, sharing economy would not develop, the unemployment rate would be higher and innovating would not be that easy. Sharing economy is the best example on how individuals adapt new technologies and use them more usefully. According to Financial Times (2016), there even are some funds that are established in order to support and finance start-up companies in the sharing economy. Modern approach sees the close connection between the economic stability and developing new technologies. It is hard to separate these two terms apart from each other, because they are two parts of a whole. Individuals subconsciously adapt and adopt new technologies to navigate through the sharing economy, which would hardly exist if there were no technologies. The development of these two is logical and could be seen as a parallel process of building the future.