The Sharing Economy & Unemployment

The article examines the relationship between the “sharing economy” and unemployment, arguing that the rise of collaborative consumption platforms is a direct response to economic challenges, particularly high unemployment rates.

• The author highlights that over 50% of youth in Greece and Spain are unemployed, with even higher rates when considering underemployment.
• The author argues that prolonged periods of unemployment can have a lasting negative impact on earning potential.
• The article points out that the US unemployment rate, while lower, is still unacceptably high at 17%, and this is compounded by increasing levels of debt, particularly student loan debt.

The Rise of Deflationary Economics

The author posits that the most successful internet companies of the past 15 years have been “deflationary” — driving down prices and margins while providing products with initially lower functionality.

• This deflationary trend, coupled with increasing internet access and the widespread adoption of smartphones, creates a fertile ground for collaborative consumption models.
• The author suggests that the “necessity is the mother of invention” principle is at play, with people turning to these platforms to supplement their income or to make ends meet.

Types of Collaborative Consumption Companies

The author categorizes collaborative consumption companies into five key categories:

• Tapping into Global Markets: Platforms like oDesk and DeviantART enable individuals to access global markets for their services and talent, potentially earning higher wages.
• Empowering the Under-Employed: Platforms like TaskRabbit and DogVacay provide opportunities for individuals with limited employment prospects to earn extra income.
• Moving from Hierarchic to Flat Structures: Platforms like Lending Club and Bitcoin create decentralized ecosystems, bypassing traditional intermediaries and empowering individuals to directly engage in financial transactions.
• Breaking Down Markets Requiring Physical Barriers: Platforms like Udacity enable access to education and professional development without the limitations of traditional physical barriers.
• Making Existing Markets More Efficient: Platforms like Uber and Lyft optimize existing transportation markets, offering consumers greater convenience and lower prices.

The Sustainability of Collaborative Consumption

The author asserts that collaborative consumption is a long-term trend, driven by persistent economic challenges, including unemployment, globalization, and resource scarcity.

• The author acknowledges that while venture capital and media attention may fluctuate, the underlying drivers of the sharing economy remain robust.
• The article argues that collaborative consumption provides a counterpoint to top-down control, empowering individuals and fostering transparency.

The Future of Collaborative Consumption

The author discusses the evolution of collaborative consumption networks, suggesting that while some companies may face challenges, others will adapt and thrive.

• The article highlights companies like Deliv, which cater to established businesses, enabling them to compete with online giants like Amazon.
• Deliv leverages collaborative consumption principles to offer businesses same-day delivery services at competitive prices, benefiting retailers, drivers, and consumers.
• The author predicts that more companies will emerge to help traditional businesses integrate with collaborative consumption networks.

Transparency & Discontent

The article touches upon the link between transparency and discontent, arguing that the increased openness provided by technologies like Twitter can heighten awareness of inequalities and fuel social unrest.

• The author draws parallels to recent revolutions and protests in countries like Tunisia, Egypt, Syria, and Turkey.
• The article suggests that collaborative consumption is not just an economic phenomenon but also a social and political force, driving greater transparency and empowering individuals.

Collaborative Consumption: A Force for Change

The author concludes that collaborative consumption is more than just a passing trend. It is a transformative force that will continue to shape the future, driven by persistent challenges like unemployment, globalization, and debt.

• The article emphasizes that solutions to global challenges will increasingly come from individuals collaborating and working together.
• Collaborative consumption represents a shift towards a more equitable and sustainable future.