If you have a spare room in your house, a car you only drive occasionally, or some extra garden tools you never use, it has never been easier to cash in on them, thanks to the growth of the “share economy.”
Not that sharing your couch or giving your friends rides is a new phenomenon, but technology has made this sharing culture easier than ever. As a result, and in response to skyrocketing cost of living in many cities that make housing and transportation unaffordable to many, sharing culture has taken off in cities around the world. Companies such as Airbnb, Uber, and Lyft — which provides a platform to rent out your personal apartment or car, respectively — are at the center of this debate surrounding this new sharing economy.
Many praise sharing companies such as Airbnb or Lyft as a way to combine resources by capitalizing on the demand for services such as transportation and housing in highly desirable and expensive cities such as New York or San Francisco. Supporters see these type of services as an efficient way to provide a superior service, based on common trust that harkens back to an idyllic “village utopia” model of community.
In an interview with New York Times columnist Thomas Friedman, Airbnb founder and CEO Brian Chesky explained the idea behind this ideology. “There are 80 million power drills in America that are used an average of 13 minutes,” said Chesky. “Does everyone really need their own drill?”
Consequences of the sharing economy
But there are many others who see the inherent complications in a sharing culture that benefits a select few, while disadvantaging others.
“The sharing economy doesn’t build trust – it trades on cultural homogeneity and established social networks both online and in real life,” writes Susie Cagle in Medium. “Where it builds new connections, it often replicates old patterns of privileged access for some, and denial for others.”
"But this means that same housing is being taken off the market for people who actually need it.”
For instance, many housing rights advocates argue that Airbnb makes housing scarce in cities such as New York that are already facing a housing shortage and, as a result, price many out of the city altogether.
“The short-term rental business is lucrative because it makes a lot more sense to rent out units short-term, as long as you have the infrastructure to do so,” Sara Desmond, a spokesperson for the legal housing advocacy group Housing Conservation Coordinators, told VICE News. “But this means that same housing is being taken off the market for people who actually need it.”
“The idea of sharing your house is an old one."
But Airbnb disagrees that it has an adverse effect on housing prices.
“The idea of sharing your house is an old one, it's just the technology to facilitate it is new,” Nick Papas, a spokesperson for Airbnb, told VICE News. “We’re not opposed to regulation. We’re in favor of making sure we have laws that protect the public interest.”
To help spread this ethos of sharing, Airbnb recently announced a new initiative called “Shared City” in Portland to “help civic leaders and our community create more shareable, more livable cities through relevant, concrete actions and partnerships.”
The growth of this economy also raises questions of regulation, taxes, and who exactly is responsible in these types of transactions. Hotels, for instance, are some of Airbnb’s other opponents because the apartment rental site bypasses the substantial taxes that hotels are forced to pay.
Uber and Lyft have made enemies in almost every city they operate in, with taxi unions and local governments trying their best to get them out. Most recently, Virginia’s Department of Motor Vehicles banned ride-sharing services such as Uber and Lyft after facing mounting opposition from the state’s taxi and livery groups.
A similar showdown is happening in Boston, where the Boston Taxi Drivers Association is working with the city government to get Uber out.
Ride sharing services such as Uber are unhampered by many of the regulations and fees that authorized taxis and livery vehicles are forced to pay, which angers cab drivers and others who argue that this puts them on an uneven playing field.
This has led to a crackdown on those offering rides in unauthorized taxis, with two high-profile cases garnering attention recently in New York.
Last month, postal worker Melih Kalyoncu was fined for operating an illegal taxi after dropping off a couple at Kennedy Airport in New York. Kalyoncu said he was just doing his friends a favor by giving them a ride, but an inspector from New York’s Taxi and Limousine Commission (TLC) thought otherwise. Kalyoncu and his friends who he was dropping off, who are white, said that they thought he had been unfairly racially profiled because he was Turkish and had a Koran on his dashboard.
This follows a similar case in Queens, New York, in which a black man was pulled over and accused of operating an unauthorized taxi by the TLC. Dan Keys Jr. said he was simply giving his wife, who is biracial, a ride to work when the TLC mistook her as a customer. Keys Jr. and his wife are suing the TLC for $3 million for racial profiling.
A TLC spokesperson declined to comment on the lawsuit to VICE News, since the litigation is ongoing.
“We’ve had this issue [of unlicensed drivers] for several years and people acting as livery drivers,” Conan Freud, a spokesperson for TLC, told VICE News. “When we see this we have the authority to seize that person’s vehicle.”
Freud added that he did not think there was a direct correlation between the increase of unlicensed drivers and the introduction of Uber in New York, but that could be because Uber drivers must undergo a substantial background check and licensing process, the same as any other livery driver in the city. Lyft, on the other hand, does not operate in New York.
There have been some other unsettling incidents involving Uber drivers elsewhere in the country where there are less regulations. In Los Angeles, earlier this month, an Uber driver was arrested for allegedly kidnapping a drunk woman.
Despite the criticisms towards Airbnb and Uber, however, the share economy does not seem to be going anywhere anytime soon. If you have an extra parking spot you’re looking to rent out, look no further than Parkatmyhouse.com. Or if you’re a pet-lover who wants to dog-sit for a stranger for a couple of days, check out DogVacay. Kitchensurfing.com connects foodies with chefs to come to their house and cook a restaurant meal in their kitchen and Vayable.com is a site that locals can use to offer tours of their cities to tourists.
“Everyone on the block doesn't need their own chainsaw."
There was even a conference held in May in San Francisco called Share that aimed to “catalyze the sharing economy” and was sponsored by responsible capitalism firm SOCAP and sharing economy advocacy group Peers.
“The sharing economy makes sense insofar as socially we don't need one of every consumer good per household,” Malcolm Harris, editor of Share of Die, told VICE News. “Everyone on the block doesn't need their own chainsaw, and with the growth of sophisticated communications technologies, it's easier than ever to divide time on that chainsaw equitably and efficiently.”
But in addition to the economics of the sharing economy, it also raises the question of equity and who exactly gets to participate in this economic system.
“Reducing barriers to sharing resources in the short-term and long-term is a good thing, but not if the efficiencies that result accrue to a small owner class,” added Harris. “If we only need to buy one-thirtieth of a chainsaw or a car or a washing machine, then we can afford to be paid less, which is what's happening. It's a survival tactic, a way for people to live with less, but the more people learn to live with less, the smaller 'less' becomes.”
Follow Olivia Becker on Twitter: @obecker928
Photo via Wikimedia