How does the Chinese government’s strict supervision of platforms affect the development of the sharing economy?

Overview of the article

With the advent of the digital age, Yochai (2006) pointed out that technology has driven the development of the entire Internet, changed the traditional way of information dissemination, promoted the birth of the network economy, and moved to the stage of globalization to reform traditional economies. The continuous development of the Internet economy has gradually derived from the sharing economy because the network economy and the sharing economy have similar approaches and goals. John (2016) defines the sharing economy as a digital economic system that relies on the Internet and various social platforms for development. It is also called the cooperative economy. Therefore, the network and sharing economies must rely on the Internet to achieve development results. However, the birth of the sharing economy has triggered “platform capitalism” (Flew et al., 2019, p. 34). Srnicek (2017) emphasized that infringing user privacy and stealing user data are the main characteristics of platform capitalism. Flew (et al., 2019) also pointed out that due to the prevalence of platform capitalism, governments in various countries have continuously strengthened their supervision of social platforms and intervened in the operational strategies of social platforms. The practices of various governments have effectively protected the privacy of social platform users and maintained their own country’s network security. However, Srnicek (2017) also pointed out that if the sharing economy wants to develop, it must challenge the laws implemented by the government on platform supervision. The government’s overly strict supervision of platforms will only cause the sharing economy to lose development opportunities and indirectly affect the country’s overall economic development. Zhang (2022) pointed out that the Chinese government implements authoritarian policies and a stringent regulatory system in terms of platform supervision and that as the times change, the Chinese government’s platform supervision policies will become more and more stringent. It shows that the Chinese government is determined to maintain the security of online social platforms and actively create a safe online environment for society. At the same time, the space left for the development of China’s sharing economy is getting smaller and smaller, and the development speed of the sharing economy has also been restricted, which is not conducive to the diversified development of China’s market economy. Therefore, this hyper-textual essay will argue that the Chinese government’s strict supervision of online platforms has dramatically restricted the development of the sharing economy. In order to make the argument more convincing, this hyper-textual essay will take the platforms of Douyin, Didi Chuxing, and Tmall as examples to support the argument from three aspects: digital rights, job opportunities, and trade freedom.


#China welcomes foreign companies, including those from the US, to enter its market, share development dividends and jointly promote the growth of the global economy, the Chinese Foreign Ministry said on Wednesday.

♬ original sound – People’s Daily 人民日报

Digital rights

To begin with, the Chinese government’s strict platform regulation has dramatically restricted the development of the sharing economy because it seriously affects the implementation of people’s digital rights on social platforms. Karppinen (2017) defines digital rights as access to freedom and all democratic communication rights on social platforms, including freedom of expression and equal opportunities for participation. Digital rights, like human rights, emphasize equal freedom and democracy. However, people’s digital rights are constantly undermined in the Internet era. As Chen (et al., 2022) pointed out, Douyin live streaming has become an essential way for people to solve their daily supply problems during COVID-19. It responds to the government’s call to stimulate consumption and stabilize the social economy and contributes to the development of the sharing economy. Huge contribution. However, the government and platform developers implement real-time monitoring of the conversations between sellers and buyers during transactions in live broadcast rooms, strive to achieve content moderation and filter out inappropriate comments. Gillespie (2018) pointed out that various countries’ governments use social platforms to shape good social and cultural phenomena under the pretext of content moderation. However, the government’s strict control promotes civilized communication between buyers and sellers and effectively controls transaction disputes. Sellers can also make more profits from product sales because the government’s move to filter speech helps sellers eliminate negative reviews of their products. However, filtering out inappropriate comments threatens people’s digital rights. Because the government’s actions restrict people’s freedom of speech and deprive people of their right to know about products, they will induce consumption and reduce people’s online shopping experience. If fewer and fewer people shop online, e-commerce will become unprofitable and affect the development of the sharing economy. In addition, digital inclusion needs to be better reflected, violating Reisdorf & Rhinesmith’s (2020) definition of digital inclusion as giving everyone the power to access all information and learn all digital technologies. To sum up, digital rights have yet to be well implemented despite the Chinese government’s strict supervision of platforms, which has also restricted the development of China’s sharing economy to a certain extent. 

Livestream Ecommerce BYFeifei,Liuis licensed underCreative Commons 1.0 Universal Licence

Job opportunities

Also, the Chinese government’s strict platform control has primarily restricted the development of the sharing economy. The second reason is that job opportunities have been reduced. Zou (2017) pointed out that China’s online ride-hailing platform, Didi Chuxing, occupies a large share of China’s sharing economy market and has become the central pillar driving the development of China’s sharing economy. Zou (2017) also pointed out that 1 billion people registered as Didi drivers before 2020, and 50 million private cars have been put into operation. It can be seen from the astonishing figures that Didi has provided many jobs for the entire Chinese society and solved the employment problems of different groups in society. At the same time, it also solved “the problem of urban traffic congestion and enhanced the city’s infrastructure service construction” (Chen & Qiu, 2019,p.275). However, after the Chinese government and all social platforms jointly formulated strict regulatory policies, Didi Chuxing lost its drivers seriously. Sun (et al., 2019) mentioned that Didi Chuxing has lost about 47,000 drivers yearly since introducing a sub-supervision system for driver services and implementing price rationalization. The driver service sub-supervision system has effectively improved the service quality of online ride-hailing services and standardized the service behavior of drivers. At the same time, selecting high-quality drivers to provide services effectively protects people’s travel safety and avoids the recurrence of sexual assault incidents in 2018. From another perspective, reducing online ride-hailing drivers will make many people unemployed and increase the unemployment rate in society. In addition, the reduction of drivers on online ride-hailing platforms will also lead to labor shortages in the sharing economy market, severely damaging the development of the sharing economy. In addition, Didi Chuxing is an indispensable part of the development of China’s sharing economy, so it is more beneficial to prove that the Chinese government’s strict supervision of the platform has greatly restricted the development of the sharing economy.

DIDI logo ByVIKNESH VIJAYENTHIRANis licensed underCreative Commons 1.0 Universal Licence

Trade freedom

Finally, another reason the Chinese government’s strict platform control has dramatically restricted the development of the sharing economy is that trade freedom has been affected. Wang (2016) pointed out that the Chinese government has established strict customs supervision policies for cross-border e-commerce and international trade, increased commodity taxes, strictly reviewed cross-border e-commerce products, and removed non-compliant products. The Chinese government’s actions have effectively maintained the stability of the domestic e-commerce market, but it also reflects that China’s foreign trade is not open enough, and free trade is still restricted. At the same time, it also promotes the “nationalization” of goods (Lemley, 2021, p.1400). Elliott (2009) defines nationalization as the change of control or ownership of things from private to state-owned. China’s exclusion and restrictions on cross-border products help nationalized products occupy a higher market share in the sharing economy market and avoid the risk of supply interruption for cross-border products. However, if goods are nationalized, products and markets will remain the same. People’s choice of goods is also restricted, resulting in the inability to trade freely. In addition, the rejection of cross-border trade and products hinders cultural exchanges and collisions between countries, causing the entire society to lose diversification. People’s horizons are no longer broadening. For the sharing economy, achieving successful development with a diversified market is easy. Therefore, only when trade freedom is no longer restricted, and a diversified market is opened the sharing economy can strive for development. The Chinese government’s strict supervision of platforms has become a stumbling block to the development of the sharing economy.

Inauguration of Djibouti International Free Trade Zone | Djibouti, 05 July 2018” by Paul Kagame is licensed under CC BY-NC-ND 2.0.


To Summarize, this hyper-textual essay demonstrates from three aspects: digital rights, trade freedom, and job opportunities that the Chinese government’s strict supervision of platforms has dramatically restricted the development of the sharing economy. Leiner (et al., 2009) pointed out that the Internet and social platforms have become the backbone of economic development because the Internet and social platforms have become tools for commercialization (selling various goods and posting commercial advertisements). In other words, the Internet and social platforms can meet all people’s economic needs. Therefore, the Chinese government needs to appropriately relax regulations on platforms to give the sharing economy enough space for development and open up to the greatest extent so that the sharing economy can drive the development of the entire Chinese real economy. Otherwise, the sharing economy will not achieve breakthrough development and innovation and will not make an outstanding contribution to China. China’s overall economy will likely be in a sluggish state and slow down the country’s progress.

Sharing Economy: cuando compartir es ganar” by IDaccion is licensed under CC BY-SA 2.0.

Erfolgreich im Internet” by Hangout Lifestyle is licensed under CC BY 2.0.


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How does the Chinese government’s strict supervision of platforms affect the development of the sharing economy? © 2023 by Guancun,Lu is licensed under CC BY-NC-ND 4.0