Magazine article The Spectator

What's Wrong with the 'Sharing Economy'

Magazine article The Spectator

What's Wrong with the 'Sharing Economy'

Article excerpt

The sinister, manipulative side of Uber and Airbnb

Technology businesses have a genius for inflicting indignities on us and spinning them as virtues. When they don't want to respect copyright, they talk about the 'democratisation of content'. When they want to truffle through our contact lists and browsing histories, they talk about 'openness' and 'personalisation'. A hundred years ago, when a widow had to take in lodgers to pay the bills, it was called misfortune. Today, when an underemployed photographer has to rent out a room in his house or turn his car into a taxi, it's called the 'sharing economy'. First Google took his job. Now Airbnb wants his house. Next they'll be after his pets.

In fact, they already are. Businesses are now emerging which offer you the chance to turn those hairy, underutilised masses snoring on the kitchen floor into cold hard cash. The theory goes that cities are full of animal lovers who want a brief fling with your golden retriever without the commitment of long-term ownership. The pet owner gets paid and brings a smile to the emotionally stunted urban professional who takes Fido for the weekend. The world is a better place. But you do wonder where it all stops. Since we're talking about renting out dear family members, there's always Granny, sitting underutilised in the corner. Why not monetise her spare time by renting her out to homesick travellers? They get to spend a relaxing few hours with a kind-hearted pensioner on a Sunday afternoon. She gets cash. Build an app to match lonely travellers with grannies in their area, create a granny rating system... get me a venture capitalist!

The potential absurdities of the sharing economy stem from the fact that it has little to do with sharing at all. In a genuine sharing economy, we would all be lending and borrowing based on trust. What we call the sharing economy is in fact a transactional economy, one in which everything is commoditised. I don't simply lend you my lawnmower. I pay to join a service which matches lenders and borrowers of lawnmowers, and each time a lawnmower is lent or borrowed, a price is paid and a commission ka-chunks into the accounts of the matching service. The banner companies of the sharing economy, Uber and Airbnb, do exactly this. They don't own cars or apartments. They have created a platform where passengers find drivers and renters find property owners. Nothing gets shared. Everything is paid for. This is efficiency under the virtuous guise of sharing.

The origins of the sharing economy lie in a set of ideas and economic forces with good and bad implications. There is the peer-to-peer economy, in which rent-taking intermediaries are stripped out of the process -- a good thing. I have a home to sell, you want to buy it. Let's do the transaction without paying the useless estate agent. Then there is the idea of collaborative consumption, which arose from the sense that rather than all of us consuming more, we should consume what we have more efficiently. You have a car which you only use on weekends, perhaps I pay some of the costs and use it during the week. It's cheaper than paying car rental companies, means we both use one car instead of buying two, and maybe we help the environment by all having less stuff. This becomes especially important as more people move into cities. As we all pile into tighter spaces, we can't all have what we'd like, so it makes more sense to share. …

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