Technology is a force for good that has improved human development since the beginning of civilization. The 21st century has seen many ideas and innovations which contributed to rapid growth throughout society and changed the way people live and interact. Among these innovations – or paradigm shifts – is the sharing economy. The sharing economy, or collaborative economy, is the new financial system that uses online transactions. This new economic model allows people around the world to share goods and services, to work together, to solve problems, and much more, all while improving the economy. Take an example from the transportation industry. Imagine a family that struggles to pay their bills. If that family has a car, that car can be used to make extra income by giving strangers a ride on their way home to work. This is a way the sharing economy helps the transportation industry; however, many other industries like hospitality, entertainment, healthcare, and logistics have also been affected. The sharing economy has positively changed the world and it is here to stay. It will give people from around the world more opportunities and security, and it will make the overall economy more efficient.
According to Abraham Maslow’s hierarchy of needs, physiological and safety needs are the most essential. While physiological needs include the necessity for air and water, it also includes shelter, food, and clothing. In order to fulfill these very basic needs, an individual in modern society needs a job. It is true that some of these necessities have been and continue to be acquired in primitive societies; nonetheless, in terms of modern society in the 21st century, people around the world seek employment for the purpose of feeding, clothing, and protecting themselves and their families. Before modern technological advances (e.g. the Internet and smart phones) became available, the sharing economy was not realistic. Many people were forced to find a job or start a brick and mortar business. When the economy is good and paychecks are high, these needs and many higher-level needs can be met. However, when the economy is bad, many people suffer. The only – legal – way they can survive is through employment. With the sharing economy, many more opportunities have arisen. If somebody needs more money for any reason, they can, for example, share their house or car for money. At the same time, they can find freelance jobs that offer part-time work. The opportunities are plentiful.
The sharing economy also provides safety. As people work to provide for their family, they need to keep the future in mind. In order to do so, money and investments are both important. From the rich individual who has a big house and nice car and to the poorer one with just enough money to live comfortably, having the opportunity to share their skills in their free time in exchange for monetary assets, is priceless. It not only gives them the chance to save and invest more money for the future, it gives them a sense of security to know there will be opportunities in the future in the case they lose a job or some other tragedy happens in their life. Take for example a skilled doctor who has to quit their job for some reason. That doctor can take advantage of the sharing economy and offer their skills to people in need via companies like Heal or Medzed. In other words, they can go visit patients in need and offer their services. The doctor will feel safe because he or she has the opportunity to earn income during difficult times in their life.
The collaborative economy doesn’t just satisfy the basic human needs in life though, it makes life better and more comfortable for everybody. It contributes to people around the world living a more fulfilled life; it leads to self-actualization. Offices around the world are emptying while more and more workers are doing their job at home. While some of these jobs are with a company and a virtual boss, many people are choosing the entrepreneurial life. These days, many people are realizing they can offer their skills to the market without working for a company. This just gives the individual with initiative and drive more opportunity to achieve their dreams because they can share their skills with society in return for monetary gain and do not need a boss to do so. It also lets people do what they love.
Other than helping the hardworking employee and entrepreneur improve their quality of life, the sharing economy is beneficial to the overall landscape of macro-economics. In other words, the sharing economy is more efficient. Instead of having one person in a car going to work, two or three can take advantage of the same car. This helps clear up the roads and cut back on pollution. It is the same thing for information. While information used to be scarce, it is now plentiful. All information can be shared via the Internet. With this information, new ideas and inventions become possible. For this reason, the world is advancing faster than anytime in human history and it will only get faster. Medical theories and solutions can freely be shared to practitioners around the world. Computer code is often open-source and worked on by communities of people. The benefits of the sharing economy are endless; it is still unknown the advances it will bring in the very near future.
While the thesis of this blog argues for the advantages of the sharing economy, there is another point of view on just how advantageous – or disadvantageous – it really is, more specifically concerning industries being disrupted and jobs erased from existence. Take the transportation industry discussed above as an example. Drivers around the world are losing their jobs due to the rise of Uber, Lyft, and Didi Dache. More and more jobs are endangered every year. However, this is a part of life; it is nothing new. At one time, typesetters were commonplace in the world, but they do not exist anymore. It is important that the education system prepares young minds to be prepared for change. Citizens from around the world need to continually hone their skills and anticipate change.
Though this new collaborative economic structure is not perfect and won’t benefit everybody, it will continue to develop and influence the global economy. It has and will provide more and more opportunities, safety, and it will make the economy more efficient. The future will be extremely exciting.