With the popularization and expansion of the Internet, many sharing economy companies have emerged in recent years in accommodation, catering, transportation and other fields. The sharing economy has developed into an important model for modern business innovation, which can benefit more users and enterprises. While the sharing economy brings opportunities to more individuals and organizations, it also brings more challenges. This essay mainly analyzes how the business model of the sharing economy operates and how it brings opportunities and challenges in three aspects: job opportunities, convenience, and user safety.
The term “sharing economy” refers to a new economic model that makes use of the more advanced capabilities of the internet to link more individuals or organizations for the purpose of sharing resources, opportunities, and services (John, 2016). The rapid expansion of the sharing economy is, without a doubt, beneficial to the development of society. Not only does it make it possible for a wider range of individuals and organizations to have equal work opportunities, nonetheless it also gives consumers access to living arrangements that are more convenient and flexible. However, the sharing economy is not without its shortcomings, the most prominent of which are potential risks to the safety of users and workers such as insufficient platform supervision, irregular working hours of workers, and platform monopoly.
Virgin. (2014). What is the sharing economy? [Video]. Youtube. https://www.youtube.com/watch?v=5y2P4z7DM88
Advantages of Sharing Economic
Sharing economy platforms create additional employment opportunities for workers and narrowed the economic divide between rich and poor (Ganapati & Reddick 2018).
- Workers do not need to have advanced academic degree, a strong financial background, or extensive experience. They can work on sharing economic platforms after simple training. For example, the Uber eats platform provides job opportunities for a large number of people to deliver food to customers. The food delivery driver only needs to have a bicycle or electric vehicle for transportation and a mobile phone that can navigate, and then can start to work.
- Working hours are very flexible, and there are no fixed working hours (Ganapati & Reddick 2018). They can choose the working time period at will, which allows many people to work part-time after get off work and earn more income. For example, designated driver service is a very popular sharing economy in China. Workers can choose to start taking orders at any time. Many people choose to go to some restaurants after get off work to provide designated driver service for drinkers, and can earn more than 1,000 RMB in just a few hours.
- Sharing economy platforms are also friendly and inclusive for people with disabilities, enable people with disabilities to take on flexible jobs outside of traditional workplaces (Dai & Brady, 2019). The core of the sharing economy platform is to communicate and conduct transactions with customers through software. Therefore, disabled workers can communicate with customers through text on the platform, which to a large extent helps provide an income for special groups in society. For example, Meituan is a very popular online food delivery platform in China. Meituan’s huge customer base requires corresponding food delivery worker including special groups. At the same time, Meituan has special care for disabled workers. For example, the food delivery worker only needs to deliver the food to the customer’s address in a timely manner without excessive negotiation, because Meituan marks special situations for delivery worker on the food delivery system to facilitate communication between customers and food delivery workers. Many special groups have obtained a fixed income through sharing economic platforms, and their quality of life has been greatly improved.
Disadvantages of Sharing Economic
Many people have chosen to work full-time on sharing economy platforms due to the platforms’ loose regulatory systems, while traditional businesses have suffered substantial monetary losses as a result.
- Sharing economy platforms have low supervision over workers, and workers do not require a lot of cost or experience, so most people choose to work full-time ( Migai et al., 2018). This has led to a substantial increase in the income of sharing economy platforms and a shortage of workers in traditional industries (Van, 2018). For example, DiDi is the most valuable among the sharing economy platforms, but their supervision system for workers is imperfect. Workers only need to be able to drive and have a car to start taking orders anytime, anywhere. And there is no working time limit, workers can work as long as they have time. However, this overly simple regulatory system has doubled the pressure on taxi drivers in the traditional industry, with more people choosing the convenient and cheap online DiDi service.
Jobs and workers on sharing economy platforms lack security and well-being, and are easily exploited by the platforms (Ganapati & Reddick 2018). As a new industry that may boost the nation’s entire economic cycle and tax revenue, the government initially regarded the sharing economy with very little oversight.
- Workers provide services to customers through the sharing economy platform, and the platform takes a portion of the workers’ income as commission. However, due to insufficient government supervision, many platforms deliberately deduct more commissions from workers. Or in order to provide users with more preferential services, the platform provides preferential treatment to customers by reducing the wages of workers, while the commission charged by the platform remains unchanged(Van, 2018).
- The market for sharing economy platforms is now relatively mature. At the same time, as government supervision measures are not strong enough, more people choose to work for sharing economy platforms, but the opportunities are limited, which results in a large number of people having no job opportunities because the competition is too fierce, which greatly increases job instability ( Migai et al., 2018).
‘’recruitment, opportunity, employment, career, people‘’ by Mohamed Hassan is licensed under CC0 1.0 DEED
- The increase in competition among sharing economy platforms has once again widened the gap between rich and poor workers, and incomes are no longer equal (Ganapati & Reddick 2018). Some workers choose to work long hours and under high pressure in order to make more money, because platform supervision does not limit working hours, workers can control their working time at will. However, long-term high-intensity work will affect workers’ physical conditions, such as hypertension and intracranial hypertension.
The government’s supervision of sharing economy platforms is not strict, resulting in many platforms not taking adequate measures to protect users’ personal information and security (Ganapati & Reddick 2018).
- Sharing platforms have relatively low requirements for workers, and workers can work without strict background checks. If the worker’s intention is dangerous, it will pose a threat to customers. For example, there have been many horrific incidents of DiDi drivers murdering female college students. The drivers changed the route of the passengers, sexually assaulted them and then killed them. Furthermore, food delivery workers usually know customers’ detailed home addresses, however some food delivery workers maliciously track and harass customers after knowing their customers’ home addresses, disturbing customers’ normal lives.
- Due to insufficient requirements and supervision of drivers on the platform, some malicious actors use the sharing platform to attack customer information, posing a serious threat to customer safety.(Van, 2018).
Euromonitor International. (2015). Opportunities and Challenges for the Travel Sharing Economy. [Video]. Youtube. https://www.youtube.com/watch?v=M9nKUwUQXtk
The rapid popularity of sharing economic platforms has indeed brought more convenient and diverse choices to the entire social group, giving more people a promising future. For example, giving more workers the opportunity to work and providing a sustainable income source. Also, users can have a more convenient and advanced lifestyle, for example, Uber eats can deliver food to their homes. However, the sharing economy also brings some negative impacts. For example, due to insufficient government supervision, traditional industries and workers are over-exploited, and workers have no job security. And, users’ personal information also be maliciously spread, causing security issues for the whole society.
Dai, Z & Brady, E. (2019). Exploring Invisible Disability Disclosure in the Sharing Economy. ACA DIGITAL LIBRARY. https://doi.org/10.1145/3308561.3354633
Ganapati, S & Reddick, C, G. ( 2018). Prospects and challenges of sharing economy for the public sector. ScienceDirect. https://doi.org/10.1016/j.giq.2018.01.001
John, N, A. (2016). Sharing Economies. Polity. https://ebookcentral-proquest-com.ezproxy.library.sydney.edu.au/lib/usyd/reader.action?docID=4770940
Migai, C & Jong, J, D & Owens, J. (2018). The Sharing Economy: Turning Challenges into Compliance Opportunities for Tax Administrations. eJournal of Tax Research. https://www.business.unsw.edu.au/About-Site/Schools-Site/Taxation-Business-Law-Site/Documents/The-sharing-economy-turning-challenges-into-compliance-CM-JdJ-JO.pdf
Van, J. (2018). Governing a Responsible Platform Society. OXFORD ACADEMIC. https://doi.org/10.1093/oso/9780190889760.003.0008
By: SIWAN XU 05/10/23
The Sharing Economy Revolution: ‘‘Opportunities and Challenges” © 2023 by Siwan XU is licensed under CC BY 4.0