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06.25.2021

How a shared economy can help the climate

You have probably heard the phrase “sharing is caring” many times. Maybe your parents said it to you when they wanted you to share your toys with your sibling, or someone told it to you when they were stealing a piece of your pizza.

But, what does the phrase imply? For starters, it stresses the importance of being able to share your belongings with someone else, and how that suggests a positive attitude.

And it is exactly this theme that becomes relevant when discussing a shared economy approach.

The concept explained

What is a shared economy? Put simply, a shared or sharing economy is an economic system in which goods and services are jointly shared by members of a society. It often relies on communities, and the interaction within them.

This concept is not new, of course. Sharing is not a fancy new invention, but rather a common and basically ancient occurrence.

However, it is a topic of growing importance, especially when faced with the global climate crisis.

In 2014, the value of the sharing economy was around 15 billion U.S. dollars according to Statista, whereas the forecasted value in 2025 is 335 billion U.S. dollars. The huge increase in value showcases the relevance of the shared economy

Accordingly, the number of sharing economy users is growing as well. In the United States alone, that number increased from 44.8 million in 2016 to 86.5 million in 2021.

Advantages of the model

Naturally, sharing assets increases the effective use of resources, and prevents the idleness of goods and services. Thereby, it also reduces the need for the additional production of items, which decreases the amount of greenhouse gases emitted by factories.

This is good news, because it helps to mitigate the threat of global warming which is often fueled by overconsumption.

Moreover, shared economy platforms such as BlaBlaCar or AirBnB can often be more affordable when compared to traditional forms of purchases or rentals. Therefore, people with lower disposable income can also make use of these services and reap the benefits. This in turn may help to improve some social issues and inequalities.

Also, these platforms may provide benefits like not needing to pay for an empty house when on vacation or having to find a parking spot in a city.

The sharing economy theme is affecting all kinds of industries: fashion, automobile, tourism and many more.

Apparel subscription platforms like Rent the Runway enable their customers to rent designer clothes instead of continuously purchasing new ones. Or you can lease a jean, for a monthly fee at MUD Jeans. Let’s take a look at the potential savings in emissions that may result from shared economy models, especially regarding mobility topics.

According to three geographical case studies, the annual total mobility-related life-cycle carbon emissions are reduced by 3% to 18% when participating in car-sharing.

Overall, with the growing population, declining natural resources and increasing demand for goods and services, it is simply impossible to satisfy all the wants and needs of the world population. Not everyone can own a huge amount of assets – which is why sharing is a great approach, as it allows for the use to be maximized.

The issues with sharing

Still, there are some aspects that should be viewed in a more critical light.

For instance, people may tend to value other people’s property less and treat it accordingly. Consequently, the item that is being shared might be worn-out more quickly. Of course, this result is not desirable and could offset some of the model’s benefits.

For instance, electric scooters like those by the company Lime keep ending up in lakes, which creates more waste and harms the environment.

Also, shared economy platforms may simply not work in some places. Especially in small towns and areas that already lack infrastructure have a hard time accommodating these platforms. Sometimes, owning a car may be the only reasonable way of commuting to the office every day.

Additionally, the factor of comfort does play a role. There may be a sense of resistance towards sharing important assets like a car or a house, especially with a stranger. That is why issues regarding safety or liability need to be addressed.

Finally… Thoughts?

Regardless of your stance on sharing economies, the phenomenon impacts industries globally.

New business models are being developed, which stimulates innovation based on a more sustainable economic growth.

These new sharing economy tools bring many opportunities to both users and entrepreneurs. They allow for the increased use of goods and services, which helps the environment and is oftentimes more financially accessible to the broad public. Naturally, there are drawbacks that need to be tackled. But all in all, the shared economy has a great potential to be a mitigating factor in the climate crisis, which is the key issue affecting us all, globally.

 

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Now, let us know your thoughts:

  • Do you think the sharing economy concept could work on a larger scale?
  • Have you experienced any issues so far in using platforms for sharing? If yes, what kind?
  • What do you see as the greatest potential for positive change that the shared economy could have?
  • What kinds of assets would you never be willing to share with a community?
  • Did you ever consider founding your own start-up based on a shared economy model?

 

Sources

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2 Comments

  1. Annie J.

    I just recently learned about the concept of a shared economy and it’s so interesting to me! I would also welcome the effects it would have on our attitudes towards sharing in general

    Reply
    • Komoneed

      Thank you Annie! It’s a quite interesting concept… Just think of how many hours we use our vehicles (and the quantity of hours it’s parked) as an example!

      Reply
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