Synonyms

Access; Collaboration; Provision

Definition

Sharing economy is defined by a large set of for-profit and not-for-profit activities developed alongside the expansion of information technologies. Based on the idea of temporary access rather than ownership, the sharing economy proposes an alternative consumption model based on the shared use of private resources. In recent years, large academic and political debates have been devoted to investigate the contributions that sharing activities could provide to the transition toward a more sustainable future.

Introduction

The rapid expansion of information technologies and the related availability of Internet connection are creating new forms of collaborations across developed and developing countries. The sharing economy, including a large set of activities based on the use of digital platforms and peer-to-peer relationships, is an example of that. Developed alongside the growth of online connections and fueled by the global financial crisis of 2008, the sharing economy has been proposed as an alternative consumption model based on the shared use of private resources. Due to its potential to create new business opportunities and to satisfy consumption needs outside the traditional market system, the sharing economy has attracted significant global attention. In spite of the large academic and political debate, however, a clear definition is still missing, and different opinions exist in relation to the possible impacts generated on economy, environment, and society. Based on two main characterizing elements, namely, the use of information technologies and temporary access rather than ownership, the sharing economy is usually described as an umbrella for a wide range of profit and nonprofit activities including the provisions of goods and services and financial support (Acquier et al. 2017; Schor 2014; Sundararajan 2016). In Table 1, an overview of some of the main sharing economy’ activities is reported.

Table 1 Examples of sharing economy activities
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Ranging between transport services, shared accommodation, crowdfunding initiatives, and the provision of goods and services, both within and outside the market system, the sharing economy is difficult to define. Dalberg (2016, p. 2), for example, defined the sharing economy as “sharing assets – physical, financial and/or human capital, between many without transferring ownership, via a digital platform to create value for at least two parties,” and Mohlmann (2015, p. 193) classifies into sharing economy all the activities where “participants conduct sharing activities in the form of renting, lending, trading, bartering and swapping of goods, services, transportation solutions, space or money.” Matzler et al. (2015), on the contrary, define the sharing economy according to the main activities characterizing the interactions, namely, (i) a product-service system based on private ownerships and shared use of products and services (e.g., Airbnb, Uber, Zipcar); (ii) a redistribution system, characterized by a monetary or nonmonetary exchange of products (e.g., NeighborGoods, Freegle, Freecycle); and (iii) a collaborative lifestyle environment in which people share space, abilities, and time (e.g., Kickstarter, TaskRabbit, Timebanking). The lack of a clear definition and the inclusion of a large set of activities, based on a wide range of business models, make it difficult to estimate the possible impacts that sharing activities can generate on economy, society, and environment. From a theoretical perspective, sharing economy has been described as a possible solution of the instabilities generated by the traditional market regulated exchanges. In particular, the sharing economy has been framed as a system able to contribute to a transition toward a more sustainable future (Botsman and Rogers 2010). The idea of collaborative consumption, based on access over ownership, and the possibility to establish socioeconomic relationships taking place outside the traditional business environment, has highlighted the possibility of a consumption model able to reduce the impacts on environment and to increase socioeconomic opportunities across members of society. Within this context, the sharing economy seems to align with many of the objectives established by the Sustainable Development Goals (SDGs). Oriented to reduce poverty and inequalities by respecting the environmental limits of the planet, the SDGs have been established to guide the policies of developed and developing countries. In the next section, the main positive impacts of sharing activities are described in relation to the SDGs. In particular, the main risks, limits, and constraints generated by the present structure of the sharing applications are analyzed both in relation to developed and developing countries.

Sharing Economy: Benefits and Potentials in a Context of SDGs

As reported above, the sharing economy is potentially offering a large set of socioeconomic and environmental benefits. A consumption model based on access rather than ownerships and the development of new forms of businesses based on collaborations and alternative market systems can contribute to increase the efficient allocation of resources and to reduce poverty and inequality. In particular, the possible impacts generated by sharing practices can be described according to the main economic, social, and environmental implications:

  • Economic impacts: From an economic point of view, the sharing economy has the potential to introduce new business models, to stimulate economic growth, and to generate employment. The development of activities ranging across hospitality, transport, good and service provision, and financial support can contribute to diversify the economic panorama and to generate additional income across different levels of society. In particular, the following economic impacts can be identified:

    • To encourage small and local enterprise: The development of activities taking place outside the traditional market mechanisms is creating business opportunities for small and local enterprise. The creation of a specific market that change the use of privately owned resources (from private consumption to shared use) has the potential to empower individuals and to provide income and business opportunities outside large corporation and centralized institutions (Benkler 2017; Munoz and Cohen 2017).

    • To promote alternative source of funding: The generation of additional income, the community support provided by sharing activities, and the development of investment provisions based on the use of online platforms (such as the crowdfunding initiatives) are providing financial support outside the traditional banking and credit system (Stephany 2015).

    • To reduce income disparities: The generation of additional income, the creation of new business opportunities, and the provision of financial support can contribute to reduce inequalities in income generation and distribution (Frenken and Schor 2017).

    • To generate working opportunities and employment: The sharing economy has been framed as a provider of flexible employment opportunities, based on short-term contracts, freelance work, and independent working supply (Horpedahl 2015). The possibility to convert a privately owned assets and skills into marketable goods can provide working opportunities particularly for those who would previously have been unemployed.

    • Tax collection: The generation of business activities and the related income generation can provide the financial base for the collection of additional taxes (Murillo et al. 2017; Kasprowicz 2016).

    • Provision of affordable goods and services: The development of a consumption model based on access over ownership can contribute to reduce the cost of goods and to provide affordable services such as transport and accommodation sectors. In addition, the use of Internet platform and the peer-to-peer review can also contribute to reduce the searching costs and to increase the overall savings (McLaren and Agyeman 2015; Stephany 2015).

  • Social impacts:

    • To reduce the gender gap: By providing more flexible working options, the sharing economy can contribute to reduce the gender gap bypassing the potential barriers characterizing the formal work structures (IFC 2018; Schoenbaum 2018).

    • To increase social bonding, collaboration, and networking: Sharing one’s possession with others is generally perceived as a pro-social behavior contributing to improve solidarity and sense of community (Prothero et al. 2011). Most of the sharing activities, mainly based on solidarity and trust (see, e.g., car sharing and Couchsurfing), are also supposed to be able to generate social connection, intrapersonal relationships, and networking (Bauwens 2005; Belk 2010; Benkler 2017).

    • To change the traditional form of sharing: The use of Internet platform and the peer-to-peer review is contributing to extend the sharing activities from family and friends to people who do not know each other (Schor 2014).

    • To reduce the existing barriers between communities of society: The sharing activities taking place across communities of society can contribute to reduce social disparities by increasing trust and the sense of belonging to society (Benkler 2017; Fitzmaurice et al. 2016).

    • To increase democracy: The use of Internet platforms is contributing to generate e-democracy and to increase sociopolitical participation (Praharaj et al. 2017).

  • Environmental impacts: Sharing economy has been framed as a sustainable alternative to the consumption model based on the private ownership of resources. Based on the use of the hidden capacity of “shareable goods,” defined by Benkler (2004) as goods that are not used by the owner for all the time, the sharing economy has the potential to improve the environmental standards by reducing pollution and consumption. The main environmental impacts can be summarized as:

    • To reduce the energy, the material demand, and the generation of pollution and waste: The development of a consumption model based on collaborative consumption, swapping, and reuse can contribute to reduce the overall production of goods, the related pollution, and the generation of waste (Shor and Wengronowitz 2017).

    • To reduce transport-related emissions: The development of a business model based on local proximity and community can contribute to reduce the transport-related emissions. In addition, the implementation of a car sharing system can reduce the consumption of fuel and the material and energy demand for the production of additional cars (Chen and Kockelman 2015; Nijland et al. 2015).

    • To promote sustainable development by encouraging reduced and “greener” forms of consumption and transportation (Botsman and Rogers 2010).

The possible impacts reported above are clearly linked with some of the SDGs adopted by the UN Member States in 2015. By including 17 goals and 169 targets, the SDG aims to promote socioeconomic prosperity while protecting the environment. Ranging between end of poverty, sustainable development, equality, peace, and well-being, the SDGs aim to set the political agenda for the next 15 years. However, the achievement of the interrelated objectives and the multidimensional framework of the SDGs constitute an important challenge calling for a global collaboration between governments, business activities, and civil society. The sharing economy, based on the characteristics reported above, could provide a substantial contribution to the achievement of some of the goals of the Sustainable Development framework. In particular, the potential impacts generated in economic, social, and environmental terms could generate benefits across different goals established by UN. In Table 2 some of the main relationships existing between SDGs and sharing economy are identified.

Table 2 SDG and expected benefits of sharing activities
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Sharing Economy: Risks and Constraints

Despite the rapid worldwide expansion, the sharing economy is a relatively new phenomenon, and we must be alert to the possible risk and constraints. Alongside the potential benefits, the lack of regulations and the large variety of business models recently developed within the framework of sharing can generate unexpected effects across different dimensions of the socioeconomic and environmental systems. In recent years, academic literature has been discussing the discrepancies existing between the expected benefits of sharing and the possible risks related to applications. Martin (2016), Laurell and Sandstrom (2017), and Murillo et al. (2017), for example, highlighted the existing contradiction between the idea of collaborative economy and the development of for-profit activities based on the use of the sharing platforms. Studies conducted by Eckhardt and Bardhi (2015), Barnes and Mattsson (2017), and Cansoy and Schor (2017), in addition, suggest that sharing activities play a minor role in the creation of community bonds and collaborations and that the racial disparities have not been reduced by the development of alternative business models. Environmental concerns have also been raised in relation to the increasing consumption and demand potentially generated by the higher affordability of assets (Mangiaracina et al. 2015, Parguel et al. 2017, Demailly and Novel 2014). The present structure of the sharing economy has the risk to generate effects going in a direction that is opposite to that established in the Sustainable Development Goals. In the following table (Table 3), an overview of the main contradictions existing between the possible negative impacts of the sharing activities is reported in the relation to the SDG reported in Table 2.

Table 3 SDG and risks of sharing economy practices
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In addition to the possible risks reported above, the developing countries are also experiencing a set of constraints such as lack of assets and skills, lack of regulations and norms, inadequate technologies (such as Internet connection or electronic payment systems), and sociocultural disparities. All these elements, together with the negative impacts reported in Table 2, constitute a real barrier to the contribution that the sharing activities could generate on the implementation of the SDG. In addition, large varieties of socioeconomic and environmental conditions that characterize the vast panorama of developing countries make it difficult to identify common policies able to support a sustainable implementation of sharing practices. Up to now a very limited number of researches have been specifically oriented to examine the sharing economy in low-income contexts, and further analysis would be needed to investigate the possible impacts on developing trends (Retamal and Dominish 2017).

Conclusion

Sharing economy is a worldwide phenomenon. Based on the use of Internet platforms and on the access over the ownerships, the sharing economy is contributing to the development of alternative business models by introducing new way of connectivity and collaboration among people. According to this structure, the sharing economy has been generally framed as a possible solution to the negative impacts generated by the traditional market system. By promoting a more efficient and temporary use of resources, the sharing economy could potentially contribute to address some of the socioeconomic and environmental objectives reported in the SDGs. Despite these premises, however, the present structure of the sharing system involves large risks and constraints potentially able to generate inequalities, poverty, and conflicts. As reported above, the lack of clear regulations and the large variety of activities included under the umbrella of sharing could provide the base for a business model more unsustainable than the present one. In such a complex, diverse, and worldwide extended phenomenon, the balance of risks and opportunities is not an easy task. The implementation of specific policies, however, could contribute to improve the sharing practices and to align the sharing economy to the objective of the SDGs. Some of the most urgent interventions are related to the following areas: (i) to develop national and international regulations related to sharing practices, working conditions, and taxation; (ii) to support and consider the potential development of self-regulation, such as worker platforms for minimum wages or collaborative provisions among business activities; (iii) to promote inclusion through increasing Internet accessibility and literacy; (iv) to create a market and regulatory environment for the development of small and independent business activities and to break down the power of large monopolies; and (v) to develop programs of education to sensitize people around social and environmental problems related to discrimination, disparities, and hyper-consumption. These elements, among others, could contribute to shape and expand the sharing economy in respect to the individual and communities that are the constituting parts of the sharing philosophy. The potential benefits and risks related to the rapid expansion of this worldwide phenomenon should also be investigated by specific research oriented to investigate the possible impacts both in developed and developing countries.

Cross-References