Sharing economy: definition & examples - SUM: Sustainability Management Wiki

Authors: Janine Bekel, Denise Ebel, Nele Eilers, Annalena Klauck
Last updated: December 30, 2022

1 Definition and relevance

The following Wiki entry deals with the area of the sharing economy. The term sharing economy is also used synonymously with shared economy or share economy. It is understood as the economy of sharing. The background for this term is the common use of goods and services in a community, whereby goods are shared, lent, exchanged, rented, given away and, in the case of services, mediated.¹

The system of the sharing economy is based on the renunciation of acquiring property in certain areas in order to then use external services when these resources are needed. Goods and services, which are rarely used themselves (as an example, the drilling machine can be mentioned here¹) can be offered to other users via intermediary platforms on the Internet at their disposal. This process is simple, secured and not expensive.² The concept of the sharing economy provides a wide range of possibilities for sharing in many manifestations. As an example, it can include the shared use, rental or leasing of a car, privately owned parking spaces, guest rooms, gardens, toys, tools, household items as well as clothing. In addition, private driving services, free overnight accommodation, and services in the field of repair or cleaning can also be arranged. The donation of literature and food also form a possibility within the framework of the sharing economy.¹

The sharing economy also pursues specific goals. In particular, already existing capacities are to be used more advantageously. Also, the area of the consumption of the resources can be lower. Further the sharing economy also pursues the goal of the increased linkage of social contacts as well as the possibility of a strengthened solidarity of the society.¹

Many approaches of the sharing economy are based on ideas with underlying social interest and without payment. Currently, the concept is known mainly through well-known mediation services and platforms such as Uber or AirBnB, which can be found in the field of transportation or tourism.¹ The concept of the sharing economy encompasses many areas of joint consumption and use of goods and services. For example, publicly accessible swimming pools, libraries, car rentals, or ride-sharing services are not new concepts and have been established in society for some time. So are, for example, agricultural cooperatives that divide up and share costly vehicles and objects. However, the then rather laborious and limited field of the sharing economy is being given a boost and new dimensions through technological progress as well as the use of the Internet. Through online platforms as well as flexible internet access through smartphones as well as social media and also improved, more flexible payment options, the concept of the sharing economy is experiencing a strong improvement in the possibility of sharing.¹

It can be predicted that besides the current users of the sharing economy concept (digital natives, who are young and educated and come from places where income is good), older generations will also use the concept and take advantage of it. Likewise, the concept offers useful services for sectors of society with less monetary means, the use of which can bring benefits of a personal and social nature.² The existence of the aforementioned sharing, which is free of charge and serves the good of the community, is now increasingly being joined by commercially oriented rental and brokerage services. Private individuals are increasingly offering their property, while companies, communities or the state tend to take the position of mediator between private individuals.¹

In the past, the name of the sharing economy concept came up particularly in connection with the peer-to-peer (P2P) concept, which will be discussed in more detail in Chapter 3. Now, a number of companies and private individuals have also noticed the trend of the sharing economy and have incorporated this into the development of their business ideas and concepts, a development in which it is useful for the providers involved to act flexibly and quickly in order to keep up with the trend.² The companies AirBnB and Uber are examples of successful, innovative business models from the sharing economy.² Due to the change in social thought about consumption from just thinking about ourselves to the development of a new type of economic form is taking place in the direction of togetherness economy. The term sharing economy has become a term for a new field of forward-looking business ideas. Companies such as AirBnB or car sharing models use the sustainability aspect of the sharing economy for beneficial use and resource utilization. Basically, goods that are purchased at a high price and owned by (private) individuals who use them only irregularly are central to the business models and ideas mentioned.²

In addition to the aforementioned positive motivations and intentions of the sharing economy and its development as a socially anchored and advocated as well as environmentally friendly manifestation of a type of economy and as part of a sustainable lifestyle, however, aspects have now also been criticized. As an example for this the reproach exists, that from in the past unpaid assistance from the neighborhood as well as from engaged considerations turnover pursuing business models were developed. Here the sharing should not be in the foreground, but rather the renting or payment and thus revenue generation.²

2 Background

Even though digital platforms like AirBnB or Uber represent a milestone in the sharing economy, the foundation of the principle was laid centuries ago. Nevertheless, researchers agree that the principle is something novel and equally significant, based on a deeper, separate understanding of the moral and market conceptions.³

2.1 History

The principle of sharing is considered one of the most elementary forms of ecological action.⁴ It is a widespread practice with cultural as well as religious references.³ The history of the sharing economy shows that there has been a balance between the interest in property and the common good for centuries. Even nomadic societies depended on sharing to enable them to move on without heavy physical burdens. Thus, early approaches to the sharing economy promoted communal mobility without requiring an individual to live with abandonment. It was seen as a voluntary act of sharing, as it is still lived today in communities such as Aboriginal people. It was also used as part of a survival strategy, especially in times of resource scarcity.⁴

The principle of the sharing economy is considered, among other things, as a counter-concept to political and ecological undesirable developments of the past. The combination of economic developments, such as the financial crisis in 2008 or the digital upheaval, and technological developments have led to a rethinking in society.⁴ Grassmuck (2012) describes this phenomenon with the following words: “If we reinvent our heritage of sharing and cooperating we have a chance of turning the mess around that we have gotten our-selves into.”⁵^{, p.32}

After a long period of focus on hyperconsumption and private property, the principle of the sharing economy can be seen as a disruptive socio-economic system that poses a challenge to the prevailing economic models. The problem of surplus is not a novelty: it has been counted as one of the greatest ecological challenges for some time. The trend of mass consumption was especially present until the outbreak of the financial crisis in 2008. However, after the global crisis subsided, the propensity for hyperconsumption also demonstrably decreased. As a result, the reference to property became less and less important and shared access to goods and services became more common.⁶ Most importantly, both founders and society had to embrace new ways of consumption that were more cost-optimized.⁶

Likewise, with the revolution of the Internet, the New Economy, a significant milestone was set. The first P2P company was founded in 1995 with eBay, followed by craigslist in 1996 or the pioneering music-sharing platform Napster, 1999.⁶ In the early 21st century, the first sharing platforms were established, especially between the US and Europe, which enabled the free sharing of information. The continuous development of the web brought with it the integration of social networks, the possibility of instant messaging, online payment options or rating systems. Thus, consumers became prosumers, who are considered important actors in the sharing economy. In particular, the development of rating platforms plays a relevant role in this context, since the sharing economy, in contrast to earlier times, nowadays often takes place between strangers and thus requires a certain degree of trust.⁶ Thus, the principle of the sharing economy is also linked to new consumption habits, which can be defined by three different principles:

1. the promotion of P2P transactions, which are facilitated by digital platforms

2. the support of shared consumption and ownership

3. the use of smartphones and computers, which enable extended market-based activities.⁶

The evolution of the sharing economy can also be traced in generational change. Generations from 50 years ago exhibit an inherent self-centeredness, which can be attributed to the hyper-individualism of the time. In recent years, however, the trend has increasingly evolved into a drastic change of the communal. Nowadays, individuals can benefit from collaborative individualism and maintain autonomy at the same time.⁷ Gorenflo, founder of the Shareables platform, supports this development: “Communities can help people become more than they are as individuals. In other words, we benefit from collaborative individualism.⁷^{, p. 70} Often, a mindset for the sharing economy develops from the first exposure to it, transforming it from an asymmetrical activity of endless acquisition to a dynamic give-and-take.⁷

The principle of the sharing economy is also referred to over time as an indicator of digital capitalism, in the context of which many forms of the sharing economy, such as communes, communitarians, forms of communism, kibbutzim or hippies, which are characterized by the ideal of sharing, are also neglected. Even if there are clear developments and more interested parties, the question is increasingly whether the principle of the sharing economy will continue to develop as a socio-economic movement or whether pure capitalism will gain the upper hand.³

2.2 Development

Historically, the concept of sharing goods for collaborative consumption and better use of resources is not new. Several decades ago, various business models emerged on the basis of sharing, such as cooperative models or leasing models.⁸ Car sharing agencies, libraries and video stores are also examples of business models that were based on the principle of sharing in a time before the Internet.²

Under the influence of digitalization and new technologies the sharing economy has developed rapidly since its early stages.² Since 2008, a year after the launch of the iPhone, the sharing concept became more and more popular as apps opened up new business opportunities.⁸ In 2011, Time Magazine listed the idea of the sharing economy among the “10 ideas that will change the world”.⁹^{, n.p.} Two years later, Forbes Magazine also pointed out that the sharing economy offers an approach for millions of entrepreneurs to break through the market power of existing companies.¹⁰ Today, providers of the sharing economy are experiencing high growth rates, which is currently leading to controversial discussions in the public regarding the regulation of these providers.¹¹

Sharing economy growth forecast 2013 to 2025, Figure of Sustainability Management Wiki

As seen in the figure above, according to estimations published by PwC, the global value creation of the sharing economy was $15 billion in 2013, which is only a small share of the global value creation in comparison to the contribution of the traditional economy. By 2025, the value is expected to rise to $335 billion.¹² In the EU alone, there was an increase in revenue for sharing economy players from $1 billion to $3.5 billion from 2013 to 2015.¹³ As mentioned above, the sharing economy has gained even more importance due to digital influences and the emergence of new intermediary services such as Airbnb and Uber. According to estimations, transportation services in the C2C sector will experience a growth in sales of 40 % by 2025 in Europe.⁴ Thus, statistical values also prove the rapid growth of the sharing economy.

Various factors are responsible for the growing significance of the sharing economy. On the one hand, technological change plays a significant role in its development. Digital influences, such as online platforms and apps, have driven the emergence of sharing economy models since the invention of Web 2.0.¹⁴ But social change and a change in consumption behaviour are also responsible for the development of the sharing economy. In the future, ownership will no longer be desirable, much rather access to goods and the experiences associated with them.¹² The sharing economy also suggests a positive development in the near future with regard to sustainability aspects.² Numerous start-ups that are currently establishing themselves in the sharing economy are dedicated to ecological sustainability and emphasize the ecological value of their businesses.¹¹

In cities, the sharing economy has had the greatest impact to date. Airbnb, car sharing and bike-sharing for instance have become particularly successful in cities.¹¹ Due to its disruption potential, the sharing economy will have a significant impact on the classic industry in the future. Established companies have to recognize early to what extent the sharing economy poses a threat to their own business model.⁴ Already, various companies are adapting their business models by including sharing activities in order to remain an active player on the market.² Otto Now for instance, the subsidiary company of the Otto retail group, entered the e-scooter rental business in 2019 to go along with the trend.¹⁵

Despite reservations about the economic consequences of the sharing economy, its development is currently in full swing and opens up new opportunities but also threats for companies.¹⁶

3 Practical implementation

Due to the changing awareness of consumers regarding the sharing economy and the resulting changing needs, companies are faced with the challenge of meeting these changing needs. To do so, they must adapt existing business models or develop new and innovative business models.¹⁷ One way to differentiate business models based on the principle of the sharing economy is the classification according to Botsman and Rogers into the following three models: product service systems, redistribution markets and collaborative lifestyle.¹⁴ In addition, numerous other business models currently exist with regard to collaborative production, investment and the general exchange of various goods and services via (digital) marketplaces.¹⁸ Examples include the digital encyclopedia Wikipedia, which is based on crowdsourcing, or the company Kiva, whose business model is based on crowdfunding for small businesses.¹⁸

Before the three above-mentioned business models according to Botsman and Rogers are explained, the term business model on the one hand and the term sustainable business model on the other hand are to be briefly defined. Overall, there is no consensus on the definition of the term business model, so many different definitions exist.¹⁹ One popular definition comes from Teece, according to which a business model provides information on how value is created for customers.²⁰ In addition, a business model contains information about how revenues and profits are generated and what cost structure underlies the business model.²⁰

There is also no uniform understanding of the term sustainable business model.²¹ According to Lüdeke-Freund, a sustainable business model focuses on generating a high level of customer benefit while at the same time contributing to the sustainability of the company.²² In addition, the business model should influence society in such a way that it can lead to its sustainable development. Overall, the business model should therefore not only serve to generate private benefits, but also benefit the public.²² Based on these definitions, the three business models of the sharing economy mentioned above will be explained below.

1. Product service systems
The product-service system is a model in which the use of physical goods is sold in the form of a service. These goods are not sold to the customer but are merely made available to him for a certain period of time.¹⁴ Providers of such systems are companies that offer their products mostly via digital marketplaces.² In addition, many companies also offer services and other services related to product procurement and use.² In order for potential customers to check the seriousness of a company, customer reviews are an important tool. In addition, corresponding certifications can help ensure that the respective company is perceived as a reputable and reliable provider.²

One advantage of this system is that its users are less financially burdened by the temporary purchase or rental of a product than if they were to actually purchase the product.¹⁴ In addition, the company offering the service assumes the costs of maintenance and repairs, so that the user can additionally save on these types of costs.¹⁴ In principle, product service systems enable (potential) consumers to have greater access to goods and services from various areas (e.g., travel or leisure activities). What people could not have afforded before now becomes more affordable for them with the help of a product service system.¹⁴ Such a business model can further contribute to product sustainability. This is because companies aim to maximize the lifetime of the products they offer in order to save costs.²³ The business model can also help to ensure that resources are used as efficiently as possible, and waste is avoided.²³ However, there are also negative aspects of the business model. For example, in the long term it can be more expensive for users to borrow or rent products with the help of product service systems than to purchase the product once themselves.² Though, it may also be that potential customers do not accept such a system. Reasons for this may be that customers do not sufficiently trust the provider of the respective system.²⁴ Furthermore, there are people who view such systems as offers for lower-income people who cannot afford ownership or property and thus forego the offer of a product service system.²⁵

The schema of product service systems basically includes systems that lend or rent out goods.² A particularly popular example of a product service system is car sharing², which involves the shared use of vehicles. Roughly, two models of car sharing can be distinguished: station-based car sharing and free-floating car sharing.²⁶ In station-based car sharing, users can pick up the available vehicles at specific stations within the business area and must return them to the same or another of the specified stations after completing the trip.²⁶ In free-floating car sharing, there are no fixed stations, so users can drop off their vehicle again at any location within the business area.²⁶ A well-known car sharing provider that offers free-floating car sharing is the company Share Now, which has a fleet of approximately 10,000 vehicles in a total of 8 European countries.²⁷ Users of Share Now only need a driver’s license and must register once in the app. After account approval, the entire usage can be controlled and managed via the app, giving the user a high degree of flexibility.²⁷ In general, car sharing can contribute to more sustainable mobility. Since a car sharing car is used far more frequently than a private vehicle, which belongs to stationary traffic for a large part of the day, there can be a more efficient use of vehicles and a more efficient use of land.²⁸ On the one hand, this consumes less CO₂ and, on the other, frees up (parking) space, which can benefit the environment.²⁸

2. Redistribution markets
Redistribution markets are business models that offer mostly used products via a trading platform and thus ensure that these products can be reused.¹⁴ Basically, a redistribution market functions as a kind of flea market.² Here, private individuals can make their (used) products, which they no longer need and do not want to throw away, available on the respective (digital) marketplace.¹⁴ It is up to the provider whether he wants to sell the item, exchange it for another product or even give it away.¹⁴ Nowadays, online platforms are predominantly used to handle this exchange, as providers and consumers can get in touch more quickly and easily.² This type of business model can also be assigned to the principle of the circular economy, since the aim here is not to throw away used products and materials but to (re)introduce them into the cycle.²⁹ In this way, waste can be reduced, and resources can be saved.²⁹ Furthermore, used goods are usually cheaper than new products, so consumers can reduce their expenses and consequently save money.³⁰ However, there are also concerns from a consumer perspective regarding the purchase of second-hand products. On the one hand, potential buyers fear unhygienic products, which may prevent them from purchasing second-hand products.³⁰ On the other hand, there may be a fundamental need to purchase new products.³⁰ This is often related to the fact that in the case of new purchases, the seller provides the buyer with a warranty on the corresponding product and thus pays for the costs in the event of damage or repair.³¹

A well-known example of a redistribution market is the company Vinted. Vinted is an online trading platform for used clothing, used goods of the entertainment industry and other used lifestyle products.³² Vinted works according to the redistribution market business model described above: private individuals can offer their used products for sale on the Vinted platform, whereby basically no fees are charged by Vinted for buyers and sellers.³³ This raises the question of how Vinted’s business model can still be profitable. The company generates revenue from three different sources. Firstly, Vinted offers other companies the opportunity to advertise on the platform for a fee. Second, buyers can have their purchases secured for a fee. In addition, sellers can improve the visibility of their goods by paying a fee to Vinted.³³

In general, the Second-Hand market is gaining in importance from the point of view of entrepreneurs and customers. This can be seen, for example, in the fact that well-known companies such as Zalando or AboutYou have expanded their portfolio to the effect that they now also offer second-hand fashion.³⁴ Because customers attach ever more frequently value to a lasting consumption, which must be considered by the enterprises.³⁴

3. Collaborative lifestyle
Collaborative lifestyle is a concept where users choose to apply collaborative consumption of goods and services.² Here, the things consumed collaboratively are not just vehicles or bicycles, for example, which can be exchanged or lent. The users of the collaborative lifestyle combine their similar motivations and interests to act out and promote the exchange and sharing of time, space, skills, and money. Examples of local sharing can be found in many sectors. Shared workspaces can be found at The Cube London, for example. Exchanges of goods, tasks, time, and errands are also available (e.g., Ecomodo, Southwark Circle). Likewise, gardens, skills, or parking spaces are offered for sharing (e.g., Landshare, Brooklyn Skillshare, ParkAtMyHouse). In addition to the local sharing just mentioned, the Internet also provides opportunities for people to connect globally. Examples of this are social lending via P2P (e.g., Zopa, Quakle) or traveling to other countries and getting accommodation there (e.g., via Couchsurfing or AirBnB). However, it must of course be noted that a collaborative lifestyle and the application of the just mentioned is often more about an action between people than an object, which requires a certain level of trust to be able to function. On a positive note, this results in increased social connection and relationship building on an interpersonal basis.¹⁴

The online platform Couchsurfing can serve as an illustrative example of this. The platform aims to enable its members or users to experience an area (e.g., country or city) as locals experience it. For this purpose, they accept offers from members of the platform who live in this place and offer overnight accommodation (e.g., guest bed, sofa) for other members via the platform. This offers the opportunity to experience another culture and the everyday life there. Also, new contacts to other people can be made and new skills and things to learn and even something to pass on.³⁵

Furthermore, the business models of the sharing economy can also be differentiated according to the actors involved in them. The respective business models can be classified as either private sharing or business sharing.² The peer-to-peer (P2P) model belongs to private sharing, whereas the business-to-consumer (B2C) and business-to-business (B2B) models belong to business sharing.² It can also be seen that private sharing business models are mostly completely new business models that do not yet exist in this form. In contrast, business sharing business models are often already existing business models that are expanded or adapted with the help of the principle of the sharing economy.²

1. Peer-to-peer (P2P)
In this model, the respective form of sharing takes place between private individuals.² Here, companies act neither as sellers nor as buyers, but merely offer the platform through which an exchange is to be carried out.¹⁸ The company therefore does not own the products offered, but only contributes to the fact that the respective transaction can take place between the private individuals involved. The private individuals involved therefore act as buyers or sellers.¹⁸ One example of a P2P company is the online trading platform Etsy.¹⁸

2. Business-to-consumer (B2C)
The respective transaction with regard to sharing takes place between companies and consumers.² The company makes its property available in the form of a service, which the consumer can book and then use via a corresponding platform.¹⁸ Examples of B2C companies in the sharing sector are car sharing providers.¹⁸

3. Business-to-business (B2B)
In contrast to the P2P model, no private individuals are involved here. Here, the respective form of sharing takes place exclusively between companies.² A company usually offers the use of its products in the form of a service with the help of an online platform. Other companies can use this service, which means that goods can be used jointly.¹⁸ Overall, B2B sharing models have not yet become as popular as P2P and B2C models. However, B2B models in the sharing economy are expected to become more common.¹⁸ Examples of B2B companies are Getable or LiquidSpace.¹⁸

Figure 2 provides an overview of possible services and goods that are offered and traded based on the development of the sharing economy.

*Figure 2: Categorization of the goods and commodities of the Sharing Economy (own illustration according to²^,¹⁸).*

As visible in the graphic, traded goods and services can be divided into six categories, which will be discussed in more detail below.

As already mentioned in the course of this wiki, a considerable number of business models in the sense of the sharing economy have emerged in the past until today. The difference between traders of the models peer-to-peer (P2P), business-to-consumer (B2C) and business-to-business (B2B) has already been presented in the previous section. Examples of P2P models can be found in Figure 2 under the rubric of Transportation (Uber) and Accommodations (AirBnB).²^,¹⁸

Another category in the figure 2 is the entertainment sector, where the audio streaming service Spotify, the music exchange Napster and the online learning community SkillShare are particularly well-known examples. In the area of finance in relation to the sharing economy, the online loan broker auxmoney and the online fundraising platform GoFundMe are particularly well-known. The online marketplace eBay, the American advertising website Craigslist and the e-commerce website Etsy are among the well-known examples for the goods section. The service section is filled with offerings such as Time Banks and Bookatiger.²^,¹⁸

Overall, it can be seen that the principle of the sharing economy can be implemented in practice in various ways. The principle of the sharing economy has great growth potential in practice, as can be seen from the practical examples mentioned and, above all, from the fact that more and more innovative and sustainable business models are emerging that are based on this very principle.³⁶

4 Drivers and barriers

In principle, the sharing economy evokes positive associations. Terms such as sustainability or community are often associated with this concept. Therefore, it is also referred to as a driver of good society or low-cost consumption for all. However, alongside the optimists of the sharing economy, there are also critics who doubt the positive effects of the sharing economy.³⁷

4.1 Drivers

The literature identifies several factors that have had a decisive influence on the rapid growth of the sharing economy and will continue to do so in the future. Four of the most commonly cited drivers of the sharing economy are outlined below. These include new consumer needs, the increasing importance of environmental sustainability, economic thinking of individuals and economy in general and last but not least the impact of digitalization.

4.1.1 New consumer needs

There are various influencing factors that work as drivers for the development of the sharing economy. First and foremost, social change accompanied by a change in consumer values is of great importance.¹² Consumer behaviour is subject to constant change. For some time now, a development from a purely passive consumer to an active prosumer has been observed.⁴ Attitudes toward the importance of ownership and property have changed. As early as in 2011, Botsman and Rogers noted that it is no longer desirable to attach great importance to personal possessions.¹⁴ Owning a lot of things is no longer perceived as a status symbol, but as a burden. According to a survey by PwC, 43 % of consumers in America believe that ownership involves a lot of effort. Choices are time-consuming, the cost of acquisition is high, and there are also repairs to pay for and storage to consider. A purchase also takes away the ability to choose another product at will. Such a shift in attitude toward ownership is particularly evident in younger generations. A growing number of consumers are demanding a form of consumption that comes with a personal experience or interaction. Impersonal companies are thereby taking a back seat in consumer choice, leading to a shift in service from a transaction-based form to an experience-based form.¹²

The concept of Airbnb for instance originally stood for an overnight stay on an air mattress with breakfast (air bed and bed and breakfast). Even though Airbnb now pursues commercial purposes, many users expect an alternative overnight accommodation with a personal experience, such as making new social contacts. In a way, the sharing economy thus represents a counter-design to consumerism and reflects the consumer’s need for an alternative form of economy. The changing need from private ownership to collaborative forms of ownership favors the emergence of sharing economy platforms and consequently drives the development of this concept.³⁸

Environmental sustainability

As society changes and consumer values shift, there is also an increasing awareness of sustainability and eco-friendliness noticeable. In the perception of the consumer, many sharing offers correspond to the ideas of a sustainable lifestyle.⁴ In fact, the sharing economy leads to a more efficient use of resources.³⁹ Existing goods can be used multiple times and the acquisition of new resources can be reduced.¹¹ In the car sharing business, for example, it is estimated that each car in the fleet replaces about 9 to 13 cars that are owned privately.⁴⁰ Also, it can be observed that car sharing users generally use cars less frequently than if they owned one themselves, which therefore leads to savings in CO₂ emissions as well.⁴

Many sharing initiatives strive for environmental sustainability and the lowest possible consumption of resources and energy. Especially in cities, sharing can bring environmental benefits. Less energy is needed for transportation and less waste is generated as consumers share products and services and make the best out of a product’s life cycle. Greenhouse gases and air pollution are reduced, which can be seen especially in sharing offers in the mobility sector (e.g., bike sharing). The pressure of unsolved environmental problems thus also acts as a driver for the rapid growth of the sharing economy.¹¹

Economic thinking

Along with a change in consumer values, it is often cost-benefit relations that prompt consumers to use sharing offers. Consumers today live in times of rising living costs and insecure employment. The purchase of goods goes hand in hand with associated risks and an additional financial burden.⁴ Sharing offers enable more and more people to enjoy things and services that they might not be able to afford without sharing. From a social perspective, this creates participation and social cohesion.³⁷ By using sharing offers, consumers can save financial resources, as these are not invested in expensive purchases. This is particularly useful for the purchase of products that would only be used occasionally, such as a chainsaw. The sharing economy also offers the possibility of generating additional income by offering one’s own property for use. This brings another cost advantage for individuals.¹² Digital platforms also make a major contribution to the financial benefits of the sharing economy. For example, digitalization has led to a reduction in transaction costs for the intermediation of goods and services.²

The sharing economy can thus be viewed as an economic opportunity: Individuals who earn money through sharing can call themselves microentrepreneurs. Therefore, the sharing economy acts as a promoter of individual economic empowerment. However, the sharing economy offers an economic opportunity not only for individuals. Due to its rapid development and disruptive nature, the sharing economy can be seen as a commercial opportunity for established companies, entrepreneurs, industries and countries as well.³⁹ Efficient thinking and economic rationality thus also act as drivers of the sharing economy.¹²

Digitalization

Technological change and digitalization are driving the rapid growth of the sharing economy as well.¹² Internet-based platforms make the process of sharing goods and services easier, more transparent and faster for suppliers and consumers.⁸ These days, the desire for less commitment is a common phenomenon, which is also related to digitalization. Consumers no longer want to take on permanent responsibility for things.³⁷ In this context, flexibility plays a major role for consumers. Especially in times of globalization and decreasing localization, it is becoming more important to be able to access products and services at any time and from anywhere. Digital services and online marketplaces favor this development.¹² Websites, such as Airbnb, make it easier for suppliers and demanders to get in touch with each other in a personal way, even across large geographical distances.⁴ Back then, without the Internet and digital platforms, this process was much more difficult. For instance, booking a stranger’s private apartment for a vacation abroad involved high search costs combined with trust issues towards the stranger and his true intentions.⁴ In today’s digital world, the sharing economy still requires a certain degree of mutual trust between users, because otherwise the sharing of goods and services between strangers would not work.¹² Online services are associated with anonymity and criminality. However, integrated rating mechanisms led to a decrease in trust issues of consumers.²

Digitalization does not only offer advantages for consumers. Companies, for instance, gain access to big data through the provision of digital services. Information about the behavior of customers and their preferences can be used by the companies to improve their decision-making processes.¹⁶

4.2 Barriers

In the following, the limits that the principle of the sharing economy entails will be shown. In addition to the ecological aspects, these are also moral and commercialized limits.

Despite many positive effects and advocacies of the sharing economy, there are also limits that could restrict the principle.³⁷ In many respects, the sharing economy is seen as a growing network of digital markets that lack regulations. This could be disadvantageous not only for companies, which are subject to corresponding political regulations, but also for consumers.³⁹

Economic aspects
Sharing economy platforms are often accused of circumventing government regulations or, for example, of reducing tax expenditures or job creation. This could be influenced not least by the fact that social erosion processes are caused by wage dumping, among other things. For example, cab companies cannot withstand the pressure from platforms such as Uber and are not able to set prices on a level playing field. This further leads to unfair competition policies as well as unequal pay for equal work, allowing digital brokerage monopolies to hold a stronger position of power. These power relations are also disproportionate, as a questionable mass of knowledge is held by the digital platforms, leading to criticism of the handling of data protection.³⁷

Furthermore, the principle of the sharing economy is said to play a reinforcing role of the neoliberal economic paradigm, citing aspects such as the adoption of the principle by companies like AirBnB, casual labor in the sharing economy, or the lack of consideration of sustainable aspects.³⁹ In many respects, moreover, the sharing economy is said to have a gold-rush mentality: sustained growth makes for a business case that rejects political intervention in the form of regulations. Companies such as AirBnB or Uber, while reporting large revenues and profits, argue that the principle of sharing their businesses enables several people to do something they would otherwise not have been financially able to do – thus generating new growth that boosts the economy.³⁷

Sustainability
In addition to the legal disadvantages of the sharing economy, the sustainability of some aspects of the principle is also questioned. While the change of the socio-ecological practice towards a growth orientation is becoming apparent, the loss of the sustainability aspect is feared. Not only the fact that some providers are losing the basic principle of the sharing economy by commercializing it more and more plays a role in this respect. Ridesharing providers such as Uber arouse in people the inclination to do without public transport such as bus or train rides or a cab to a greater extent and to rely more on private rides. The concept of Uber makes it possible for private individuals to offer rides for other people – and at a much lower price than a regular cab ride. Here again, the aspect of wage dumping comes into play as well as the fact that CO₂ pollution is increasing again as more private cars are on the roads. Thus, the sustainability aspect of the sharing economy concept is questioned here.³⁸

Trust issues
Critics point to a commercialization of the positive effect of social togetherness: mutual trust, even among strangers, and social cooperation lose their original value. Sharing economy concepts such as AirBnB in particular rely on mutual trust. The figure 3 illustrates that the trust issue in particular can be a hurdle. People are much more willing to lend property to people they know personally than to strangers.

*Figure 3: Willingness to lend (own illustration according to⁴¹).*

It is not uncommon for this to lead to property violations, theft or similar incidents. This can discourage people from resorting to these sharing economy concepts, even if they would definitely have the option of renting out their apartment or a room.⁴² Furthermore, the assumption that the principle of the sharing economy causes a reduced consumption of resources is invalidated: the cost-stimulating effect of the diverse options of the sharing economy ultimately leads to an increased use of resources. The extent to which the possible negative effects materialize ultimately depends on the concrete design of the concept and possible regulatory measures.³⁷

Thus, it can be stated here that the sharing economy can be seen as a driver in terms of an economic opportunity and a form of a more sustainable consumption as well as a way to a decentralized and equitable economy. Contrary to these statements, the limits of the principle are marked by the creation of non-regulated jobs, the strengthening of the neoliberal paradigm, and the drift of the concept into capitalism.³⁹

References

1
Haese, M. Aktueller Begriff. Sharing Economy. Wissenschaftliche Dienste des Deutschen Bundestags 13/15, 1-2 (2015).
2
Steinmetz, N. Sharing Economy – Modelle und Empfehlungen für ein verändertes Konsumverhalten. in Handel mit Mehrwert. Digitaler Wandel in Märkten, Geschäftsmodellen und Geschäftssystemen (eds. Heinemann, G., Gehrckens, H. M., Täuber, T. & Accenture GmbH) 229-255 (Springer Gabler Germany, 2019).
3
Belk, R.W., Eckhard G.M. & Bardhi, F. Handbook Of The Sharing Economy. (E-Elgar England, 2019).
4
Schreiner, N. Konsumentenverhalten in der Sharing Economy. Analysen ausgewählter Einflussfaktoren auf das Sharingverhalten. (Nomos Germany, 2020).
5
Grassmuck, V.R. The Sharing Turn: Why we are generally nice and have a good chance to cooperate our way out of the mess we have gotten ourselves into. in Cultures and Ethics of Sharing (eds. Staldler, F., Maier, R. & Hug, T.) 17-34 (University Press Austria, 2013).
6
Martos-Carrión, E. & Miguel, C. The Sharing Economy: History, definitions and related concepts. in The Sharing Economy and the Tourism Industry: Perspectives, Opportunities and Challenges (eds. Taheri, B., Rahimi, R. & Buhalis, D.) 7-22 (Goodfellow Publishers Ltd. England, 2022).
7
Botsman, R. & Rogers, R. What’s Mine Is Yours: The Rise of Collaborative Consumption. (Collins, 2010).
8
IZA. Sharing Economy – Chancen, Risiken und Gestaltungsoptionen für den Arbeitsmarkt. (2015).
9
Walsh, B. 10 Ideas That Will Change the World. Today’s Smart Choice: Don’t Own. Share. Time http://content.time.com/time/specials/packages/article/0,28804,2059521_2059717_2059710,00.html (2011).
10
Geron, T. Airbnb And The Unstoppable Rise Of The Share Econo-my. Forbes https://www.forbes.com/sites/tomiogeron/2013/01/23/airbnb-and-the-unstoppable-rise-of-the-share-economy/?sh=2c921bdbaae3 (2013).
11
Georgi, D., Bründler-Ulrich, S. et al. ShareCity. Sharing-Ansätze, Sharing-Verhalten, Sharing-Strategien, Shar-ing-Cases in Städten. (Springer Gabler, 2019).
12
PwC. Sharing or paring?. Growth of the sharing economy. (2015).
13
Kelly, T., Liaplina, A. et al. Reaping Digital Dividends. Leveraging the Internet for Development in Europe and Central Asia. World Bank Publications, United States (2017).
14
Botsman, R. & Rogers, R. What´s mine is yours. How collaborative consumption is changing the way we live. (Collins, 2011).
15
Thieme, T. Otto Now steigt in den E-Scooter-Markt ein. Absatzwirtschaft https://www.absatzwirtschaft.de/otto-steigt-mit-anderem-ansatz-in-den-e-scooter-markt-ein-223804/ (2019).
16
Sedkaoui, S. & Khelfaoui, M. Sharing Economy and Big Data Analytics. (ISTE Ltd., 2020).
17
Voeth, M., Pölzl, J. & Kienzler, O. Sharing Economy – Chancen, Herausforderungen und Erfolgsfaktoren für den Wandel vom Produktgeschäft zur interaktiven Dienstleistung am Beispiel des Car-Sharings. in Interaktive Wertschöpfung durch Dienstleistungen. Strategische Ausrichtung von Kundeninteraktionen, Geschäftsmodellen und sozialen Netzwerken (eds. Bruhn, M. & Hadwich, K.) 469-489 (Springer Germany, 2015).
18
World Economic Forum. Young Global Leaders. Circular Economy Innovation & New Business Models Dia-logue. Young Global Leaders Sharing Economy Dialogue Position Paper 2013. (2013).
19
Zott, C., Amit, R. & Massa, L. The Business Model: Recent Developments and Future Research. Journal of Management 37, 1019-1042 (2011).
20
Teece, D. J. Business Models, Business Strategy and Innovation. Long Range Planning 43, 172-194 (2010).
21
Geissdoerfer, M., Vladimirova, D. & Evans, S. Sustainable business model innovation: A review. Journal of Cleaner Production 198, 401-416 (2018).
22
Lüdeke-Freund, F. Towards a Conceptual Framework of Business Models for Sustainability. in Knowledge Collaboration & Learning for Sustainable Innovation: Conference Proceedings (eds. Wever, R., Quist, J., Tuk-ker, A., Woudstra, J., Boons, F. & Beute, N.) (Technische Universiteit Delft, 2010).
23
Tukker, A. Product services for a resource-efficient and circular economy – a review. Journal of Cleaner Produc-tion 97, 76-91 (2013).
24
Schmidt, D. M., Bauer, P. & Mörtl, M. Product-Service Systems for Influencing Customer Barriers and Cus-tomer Acceptance. Journal of Economics, Business and Management 3, 990-993 (2015).
25
Catulli, M. What uncertainty? Further insight into why consumers might be distrustful of product service sys-tems. Journal of Manufacturing Technology Management 23, 780-793 (2012).
26
Heilig, M., Mallig, N., Schröder, O., Kagerbauer, M., & Vortisch, P. Implementation of free-floating and station-based carsharing in an agent-based travel demand model. Travel Behaviour and Society 12, 151-158 (2017).
27
Share Now. Share Now: Facts and figures. Share Now https://share-now.assetbank-server.com/assetbank-share-now/action/viewAsset?id=9961&index=5&total=8&view=viewSearchItem (2022).
28
Reppert, O. Ist elektrisches Carsharing die Lösung für nachhaltige Mobilität? Share Now https://www.share-now.com/de/de/blog-car-sharing-and-the-sustainable-future/ (2022).
29
PwC. The road to circularity. Why a circular economy is becoming the new normal. (2019).
30
Gullstrand Edbring, E., Lehner, M. & Mont, O. Exploring consumer attitudes to alternative models of con-sumption: motivations and barriers. Journal of Cleaner Production 123, 5-15 (2016).
31
Guiot, D., & Roux, D. A Second-hand Shoppers’ Motivation Scale: Antecedents, Consequences, and Implica-tions for Retailers. Journal of Retailing 86, 383-399 (2010).
32
Vinted. Was du auf Vinted verkaufen darfst. Vinted https://www.vinted.de/help/52-was-du-auf-vinted-verkaufen-kannst (n.d.).
33
Gode, S. Wie der Kleiderkreisel-CEO mit einer radikalen Strategie seine Plattform rettete und zum Einhorn machte. Business Insider https://www.businessinsider.de/wirtschaft/handel/wie-der-kleiderkreisel-ceo-mit-einer-radikalen-strategie-seine-plattform-rettete-und-zum-einhorn-machte/ (2019).
34
Bialek, C. & Müller, A. Secondhand-Mode-Plattform Vinted sammelt 250 Millionen Euro ein. Handelsblatt https://www.handelsblatt.com/unternehmen/handel-konsumgueter/modehandel-secondhand-mode-plattform-vinted-sammelt-250-millionen-euro-ein/27181832.html#:~:text=In%20den%20letzten%20zw%C3%B6lf%20Monaten,Markt%20f%C3%BCr%20Secondhand%2DMode%20prognostiziert (2021).
35
Gsöls, R. Sharing Economy. Impulszentrum Zukunftsfähiges Wirtschaf-ten https://www.imzuwi.org/index.php/98-infothek/utopedia/151-sharing-economy (2022).
36
Muñoz, P. & Cohen, B. A Compass for Navigating Sharing Economy Business Models. California Manage-ment Review 61, 114-147 (2018).
37
Loske, R. Die Doppelgesichtigkeit der Sharing Economy. Vorschläge zu ihrer gemeinwohlorientierten Regulie-rung. WSI Mitteilungen 72, 64-70 (2019).
38
Dörr, J. Sharing is caring? Entwicklungsperspektiven der Share Economy. in Digitale Wirtschaft und Sharing Economy. Wirtschaftsethische und moralökonomische Perspektiven (eds. Auferheide, D. & Dabrowski, M.) 123-143 (Duncker & Humblot GmbH Germany, 2017).
39
Martin, C.J. The sharing economy: A pathway to sustainability or a nightmarish form of neoliberal capital-ism?. Ecological Economics 121, 149-159 (2015).
40
Martin, E., Shaheen, S. & Lidicker, J. Impact of Carsharing on Household Vehicle Holdings. Results from North American Shared-Use Vehicle Survey. Transportation Research Record: Journal of the Transportation Research Board 2143, 150-158 (2010).
41
Brandt, M. Sharing. Die Sharing Economy. Statista https://de.statista.com/infografik/7024/nutzung-von-sharing-economy-angeboten/ (2016).
42
GCFGlobal. Legal and safety issues in the sharing econo-my. GCFGlobal https://edu.gcfglobal.org/en/sharingeconomy/legal-and-safety-issues-in-the-sharing-economy/1/ (2022).

1
Haese, M. Aktueller Begriff. Sharing Economy. Wissenschaftliche Dienste des Deutschen Bundestags 13/15, 1-2 (2015).
2
Steinmetz, N. Sharing Economy – Modelle und Empfehlungen für ein verändertes Konsumverhalten. in Handel mit Mehrwert. Digitaler Wandel in Märkten, Geschäftsmodellen und Geschäftssystemen (eds. Heinemann, G., Gehrckens, H. M., Täuber, T. & Accenture GmbH) 229-255 (Springer Gabler Germany, 2019).
3
Belk, R.W., Eckhard G.M. & Bardhi, F. Handbook Of The Sharing Economy. (E-Elgar England, 2019).
4
Schreiner, N. Konsumentenverhalten in der Sharing Economy. Analysen ausgewählter Einflussfaktoren auf das Sharingverhalten. (Nomos Germany, 2020).
5
Grassmuck, V.R. The Sharing Turn: Why we are generally nice and have a good chance to cooperate our way out of the mess we have gotten ourselves into. in Cultures and Ethics of Sharing (eds. Staldler, F., Maier, R. & Hug, T.) 17-34 (University Press Austria, 2013).
6
Martos-Carrión, E. & Miguel, C. The Sharing Economy: History, definitions and related concepts. in The Sharing Economy and the Tourism Industry: Perspectives, Opportunities and Challenges (eds. Taheri, B., Rahimi, R. & Buhalis, D.) 7-22 (Goodfellow Publishers Ltd. England, 2022).
7
Botsman, R. & Rogers, R. What’s Mine Is Yours: The Rise of Collaborative Consumption. (Collins, 2010).
8
IZA. Sharing Economy – Chancen, Risiken und Gestaltungsoptionen für den Arbeitsmarkt. (2015).
9
Walsh, B. 10 Ideas That Will Change the World. Today’s Smart Choice: Don’t Own. Share. Time http://content.time.com/time/specials/packages/article/0,28804,2059521_2059717_2059710,00.html (2011).
10
Geron, T. Airbnb And The Unstoppable Rise Of The Share Econo-my. Forbes https://www.forbes.com/sites/tomiogeron/2013/01/23/airbnb-and-the-unstoppable-rise-of-the-share-economy/?sh=2c921bdbaae3 (2013).
11
Georgi, D., Bründler-Ulrich, S. et al. ShareCity. Sharing-Ansätze, Sharing-Verhalten, Sharing-Strategien, Shar-ing-Cases in Städten. (Springer Gabler, 2019).
12
PwC. Sharing or paring?. Growth of the sharing economy. (2015).
13
Kelly, T., Liaplina, A. et al. Reaping Digital Dividends. Leveraging the Internet for Development in Europe and Central Asia. World Bank Publications, United States (2017).
14
Botsman, R. & Rogers, R. What´s mine is yours. How collaborative consumption is changing the way we live. (Collins, 2011).
15
Thieme, T. Otto Now steigt in den E-Scooter-Markt ein. Absatzwirtschaft https://www.absatzwirtschaft.de/otto-steigt-mit-anderem-ansatz-in-den-e-scooter-markt-ein-223804/ (2019).
16
Sedkaoui, S. & Khelfaoui, M. Sharing Economy and Big Data Analytics. (ISTE Ltd., 2020).
17
Voeth, M., Pölzl, J. & Kienzler, O. Sharing Economy – Chancen, Herausforderungen und Erfolgsfaktoren für den Wandel vom Produktgeschäft zur interaktiven Dienstleistung am Beispiel des Car-Sharings. in Interaktive Wertschöpfung durch Dienstleistungen. Strategische Ausrichtung von Kundeninteraktionen, Geschäftsmodellen und sozialen Netzwerken (eds. Bruhn, M. & Hadwich, K.) 469-489 (Springer Germany, 2015).
18
World Economic Forum. Young Global Leaders. Circular Economy Innovation & New Business Models Dia-logue. Young Global Leaders Sharing Economy Dialogue Position Paper 2013. (2013).
19
Zott, C., Amit, R. & Massa, L. The Business Model: Recent Developments and Future Research. Journal of Management 37, 1019-1042 (2011).
20
Teece, D. J. Business Models, Business Strategy and Innovation. Long Range Planning 43, 172-194 (2010).
21
Geissdoerfer, M., Vladimirova, D. & Evans, S. Sustainable business model innovation: A review. Journal of Cleaner Production 198, 401-416 (2018).
22
Lüdeke-Freund, F. Towards a Conceptual Framework of Business Models for Sustainability. in Knowledge Collaboration & Learning for Sustainable Innovation: Conference Proceedings (eds. Wever, R., Quist, J., Tuk-ker, A., Woudstra, J., Boons, F. & Beute, N.) (Technische Universiteit Delft, 2010).
23
Tukker, A. Product services for a resource-efficient and circular economy – a review. Journal of Cleaner Produc-tion 97, 76-91 (2013).
24
Schmidt, D. M., Bauer, P. & Mörtl, M. Product-Service Systems for Influencing Customer Barriers and Cus-tomer Acceptance. Journal of Economics, Business and Management 3, 990-993 (2015).
25
Catulli, M. What uncertainty? Further insight into why consumers might be distrustful of product service sys-tems. Journal of Manufacturing Technology Management 23, 780-793 (2012).
26
Heilig, M., Mallig, N., Schröder, O., Kagerbauer, M., & Vortisch, P. Implementation of free-floating and station-based carsharing in an agent-based travel demand model. Travel Behaviour and Society 12, 151-158 (2017).
27
Share Now. Share Now: Facts and figures. Share Now https://share-now.assetbank-server.com/assetbank-share-now/action/viewAsset?id=9961&index=5&total=8&view=viewSearchItem (2022).
28
Reppert, O. Ist elektrisches Carsharing die Lösung für nachhaltige Mobilität? Share Now https://www.share-now.com/de/de/blog-car-sharing-and-the-sustainable-future/ (2022).
29
PwC. The road to circularity. Why a circular economy is becoming the new normal. (2019).
30
Gullstrand Edbring, E., Lehner, M. & Mont, O. Exploring consumer attitudes to alternative models of con-sumption: motivations and barriers. Journal of Cleaner Production 123, 5-15 (2016).
31
Guiot, D., & Roux, D. A Second-hand Shoppers’ Motivation Scale: Antecedents, Consequences, and Implica-tions for Retailers. Journal of Retailing 86, 383-399 (2010).
32
Vinted. Was du auf Vinted verkaufen darfst. Vinted https://www.vinted.de/help/52-was-du-auf-vinted-verkaufen-kannst (n.d.).
33
Gode, S. Wie der Kleiderkreisel-CEO mit einer radikalen Strategie seine Plattform rettete und zum Einhorn machte. Business Insider https://www.businessinsider.de/wirtschaft/handel/wie-der-kleiderkreisel-ceo-mit-einer-radikalen-strategie-seine-plattform-rettete-und-zum-einhorn-machte/ (2019).
34
Bialek, C. & Müller, A. Secondhand-Mode-Plattform Vinted sammelt 250 Millionen Euro ein. Handelsblatt https://www.handelsblatt.com/unternehmen/handel-konsumgueter/modehandel-secondhand-mode-plattform-vinted-sammelt-250-millionen-euro-ein/27181832.html#:~:text=In%20den%20letzten%20zw%C3%B6lf%20Monaten,Markt%20f%C3%BCr%20Secondhand%2DMode%20prognostiziert (2021).
35
Gsöls, R. Sharing Economy. Impulszentrum Zukunftsfähiges Wirtschaf-ten https://www.imzuwi.org/index.php/98-infothek/utopedia/151-sharing-economy (2022).
36
Muñoz, P. & Cohen, B. A Compass for Navigating Sharing Economy Business Models. California Manage-ment Review 61, 114-147 (2018).
37
Loske, R. Die Doppelgesichtigkeit der Sharing Economy. Vorschläge zu ihrer gemeinwohlorientierten Regulie-rung. WSI Mitteilungen 72, 64-70 (2019).
38
Dörr, J. Sharing is caring? Entwicklungsperspektiven der Share Economy. in Digitale Wirtschaft und Sharing Economy. Wirtschaftsethische und moralökonomische Perspektiven (eds. Auferheide, D. & Dabrowski, M.) 123-143 (Duncker & Humblot GmbH Germany, 2017).
39
Martin, C.J. The sharing economy: A pathway to sustainability or a nightmarish form of neoliberal capital-ism?. Ecological Economics 121, 149-159 (2015).
40
Martin, E., Shaheen, S. & Lidicker, J. Impact of Carsharing on Household Vehicle Holdings. Results from North American Shared-Use Vehicle Survey. Transportation Research Record: Journal of the Transportation Research Board 2143, 150-158 (2010).
41
Brandt, M. Sharing. Die Sharing Economy. Statista https://de.statista.com/infografik/7024/nutzung-von-sharing-economy-angeboten/ (2016).
42
GCFGlobal. Legal and safety issues in the sharing econo-my. GCFGlobal https://edu.gcfglobal.org/en/sharingeconomy/legal-and-safety-issues-in-the-sharing-economy/1/ (2022).