The sharing economy doesn’t work. It was never meant to.

🌈 Abstract

The article discusses the "sharing economy" and how the lofty rhetoric around it has failed to materialize in many cases, while tech investors have made significant profits. It examines the issues with the sharing economy, including the exploitation of workers, the negative impacts on communities, and the concentration of power and profits in the hands of a few. The article argues that the sharing economy was never truly about "sharing" but rather a way for tech companies to extract profits while avoiding regulation and responsibility.

🙋 Q&A

[01] The Sharing Economy Hype vs. Reality

1. What are the key issues with the "sharing economy" according to the article?

• The promised benefits for workers and consumers have failed to materialize in many cases, while tech investors have made significant profits
• The "empowerment" narrative is largely an illusion, as most workers earn very little, lack basic protections, and have almost no control over the platforms
• The sharing economy exhibits the same extractive tendencies and power imbalances as the rest of Big Tech
• The economic benefits for workers and consumers have been poor, with low wages and intermittent work for workers, and hidden costs for consumers

2. How does the article characterize the "sharing economy" as a business model?

• The sharing economy is more akin to a traditional corporate business model, with a small group of founders and investors owning and controlling the platforms
• The platforms focus on growth at all costs to appeal to financial markets and aim to monopolize markets by driving out existing businesses
• The only thing being "shared" is revenue between the platform and the worker

3. What are some of the negative impacts of the sharing economy on communities and the environment?

• Airbnb has driven up rents and hollowed out neighborhoods as apartments are turned into de facto hotels
• Uber and Lyft have increased traffic congestion and emissions while strangling public transit revenue
• The overall environmental footprint of the sharing economy reveals the opposite of being "green"

[02] The Sharing Economy as a Scam

1. How does the article characterize the branding of the sharing economy?

• The branding of startups like Airbnb and Uber as based on "sharing" provided ideal cover to avoid scrutiny and imbued them with a sense of innocence and idealism divorced from the profit motive
• Claiming the mantle of "sharing" was a brilliant strategy to enable business as usual behind a smoke screen

2. What does the article suggest was the real "secret sauce" behind the success of sharing economy platforms?

• The secret sauce was not novel tech but applying tech to concentrate control over dispersed assets via digital platforms
• The platforms inserted themselves as rent-seeking middlemen, with little true sharing or innovation underpinning their success

3. How does the article suggest the sharing economy's problems stem from the wrong goals?

• Fixating solely on ease of transactions, network ubiquity, and returns on capital incentivizes companies to hide costs from users and regulators, leading to anticompetitive behavior and regulatory arbitrage
• Lasting solutions must realign incentives around shared goals that benefit workers, users, and communities, not just shareholders