The Sharing Economy: The End of Employment and the Rise of Crowd-Based Capitalism is written by NYU professor Arun Sundararajan.
We weren't disappointed.
The Sharing Economy provides a clear and concise description of crowd-based capitalism, the term the author prefers to call this growing segment of the economy.
The book defines this sector as having the following characteristics:
- Largely market-based: The sharing economy creates markets that enable the exchange of goods and the emergence of new services, resulting in potentially higher levels of economic activity.
- High-impact capital: The sharing economy opens new opportunities for everything, from assets and skills to time and money, to be used at levels closer to their full capacity.
- Crowd-based “networks” rather than centralized institutions or “hierarchies”: The supply of capital and labor comes from decentralized crowds of individuals rather than corporate or state aggregates; future exchange may be mediated by distributed crowd-based marketplaces rather than by centralized third parties.
- Blurring lines between the personal and the professional: The supply of labor and services often commercializes and scales peer-to-peer activities like giving someone a ride or lending someone money, activities which used to be considered “personal.”
- Blurring lines between fully employed and casual labor, between independent and dependent employment, and between work and leisure: Many traditionally full-time jobs are supplanted by contract work that features a continuum of levels of time commitment, granularity, economic dependence and entrepreneurship.
We like this definition and especially its focus on crowd-based networks and the various ways things are blurring.
The book nicely covers the topics of trust and regulation as they relate to the sharing economy. The chapter on blockchain is especially well done. It's a difficult technology to explain, but this book does a great job of covering why this technology is potentially useful in creating peer-to-peer trust networks.
Being a history buff, I also like the discussion of how the 11th century Maghribi traders managed to build multi-country commerce enabling trust networks. Fun stuff.
But Sundararajan's views on trust and regulation are controversial. He is often criticized for his view that self-regulation is one option for regulating the sharing economy. Key quote from what is overall a very positive review of the book on the International Monetary Fund's site:
Sundararajan advocates giving regulatory responsibility to the peer-to-peer marketplace and allowing new self-regulatory organizations to fill the gap. But he may be overestimating the private sector’s ability to provide sufficient consumer protection. Although keeping government regulators at bay may seem necessary to incubate the sharing economy, consumers may have to suffer through lots of dangerous rides, filthy apartments, and ruined gardens before the “collaborative” market sorts things out.
We strongly recommend this book for anyone interested in the sharing economy or economics in general.
Peppered with interesting examples and anecdotes, The Sharing Economy provides an easy to read yet highly detailed look at this increasingly important economic sector.