– More sustainable use of resources: A sharing economy helps consumers to earn money by renting out under-utilised goods or resources. ... Peer reviews and ratings are an expected part of every platform, fostering honesty and transparency, which are key components of a successful sharing economy.
Since the sharing economy is built upon 1099 independent contractors, they do not receive the same benefits as full-time employees. This leads to another problem when it comes to legal matters. In the event of personal injury, you cannot sue Uber or Lyft since their drivers operate as independent contractors.
CON: Lack of Benefits and Lost Revenue
Individuals who earn their full living in this economy do not have access to the benefits that those working for a company do.
Fake accounts and fraud in the sharing economy are growing. ... In economics, this is known as “collaborative consumption.” The sharing economy depends on the trust of other users to look after the products, lodgings and devices they share. A lack of trust only leads to adverse negative outcomes.
But it actually is not a sharing economy example. Netflix is an on-demand subscription business model. It is also not a pay-per-use business model (which is another often-repeated misnomer). ... But they are not a sharing economy platform.
In 2016, 44.8 million U.S. adults used the sharing economy, and it's expected to grow to 86.5 million U.S. users by 2021. McKinsey estimates that in the U.S. and Europe alone, 162 million people or 20-30 percent of the workforce are providers on sharing platforms.
The sharing economy is accompanied by diverse expected benefits. Through the creation of new transactions, consumers can enjoy low prices, diverse options and better quality and convenience, and suppliers can earn additional income, all of which contribute to the welfare of the participants.
For consumers, the sharing economy makes everyday life more affordable. Extensive and well-distributed participation on the supply side of sharing economy keeps prices fair, as well as eliminating the need for people to own all of their possessions.
Alternative names for this phenomenon include gig economy, platform economy, access economy, and collaborative consumption. The sharing economy is estimated to grow from $14 billion in 2014 to $335 billion by 2025. This estimate is based on the rapid growth of Uber and Airbnb as indicative.
Pros and cons of sharing economy
Abstract: “Recently, Uber has emerged as a leader in the “sharing economy”. Uber is a “ride sharing” service that matches willing drivers with customers looking for rides.
Why are sharing economy marketplaces so attractive to consumers? Lower search costs. Lots of suppliers in a traditional market mean customer search costs are high. But ratings in marketplaces help you quickly size up high-quality providers and make a lower-risk choice.
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