The Sharing Economy has great potential,
so shouldn’t government step in?
In short, the arguments are that:
- The sharing economy has tremendous potential to generate income. Via the normal economic cycles, that income translates into consumer spending, tax revenue (both direct and indirect, e.g. sales/consumption tax).
- Technology is reducing friction in marketplaces. Similarly, technology will find solutions, such as trust and reputation, for managing online marketplaces.
- Technology is also changing fast. Regulating now is a knee-jerk reaction, meant to protect incumbents. There probably are not sufficient legislative tools to manage new technology.
Many of these points are valid for all areas of technology, but they are particularly true in the sharing economy right now. The growth is coming very fast (largely at the expense of Craigslist), and in markets as diverse as car sharing and elderly care. One size will certainly not fit all.