How does the sharing economy affect capitalism?

"Sharing Economy" Curse and blessing of the sharing economy

Sharing cars, apartments and other things is no longer a niche phenomenon, but a billion-dollar business. While some find the sharing idea cozy and communal, others speak of "platform capitalism", which only stimulates consumption even more.

Friday afternoon at Düsseldorf Central Station: a good dozen bright yellow limousines meander around the taxi stand, and the taxi drivers wait bored for customers. A small white car stops a few meters away: a man with half-length gray hair gets out and opens the trunk for a passenger's luggage. It looks like he's just picking up a friend from the train station - but in reality it's an Uber driver that the passenger ordered via smartphone.

The young man who makes himself comfortable in the passenger seat is a regular: he books the Uber driver regularly when he's in town on business. The atmosphere is relaxed, mineral water and biscuits are free for the passenger. After a few minutes through the slow rush hour traffic, he has reached his destination. Billing is done automatically by credit card, and the customer can later rate the driver in his smartphone app.

"I refuse the trip, and then the system calculates the fare, in this case 83 cents for the trip from the main train station to the Rathausufer. And the customer doesn't actually have to follow it. He can, for example, if he gets a train quickly just start walking and wait for him to receive an SMS or email with the billing. "

Just a few days ago, Uber reduced prices by almost two thirds: a trip in Düsseldorf now costs just 35 cents per kilometer. No wonder that the US company's "Uber Pop" car service is considered a taxi scare.

So the driver, let's call him Maurice, would rather not hear his real name on the radio. The low prices are possible because drivers like him use their private cars - and do not need to show a taxi license or special insurance. Uber only requires a few pieces of evidence, such as that the vehicle is no more than ten years old and roadworthy.

Authorities and state governments are therefore extremely skeptical of the business model and have already issued several injunctions against Uber. The North Rhine-Westphalian Ministry of Transport has classified the Uber trips as "passenger transport requiring a permit": Since then, drivers have faced high fines.

Maurice continues anyway: he actually organizes exhibitions - for the freelancer, the model where he can decide for himself when and how often he drives is therefore ideal. When Uber started in Düsseldorf in the summer and was looking for drivers on an independent basis, the order situation for the 53-year-old was poor.

"And I kind of thought, before I run up the walls in frustration and get angry, I'll do something that will distract me. In the 80s I drove a taxi to finance my studies, and then I thought, you’ll do it again and drive around a bit. "

Officially, Uber no longer calls itself a driver service, but rather a ride-sharing service: And the upper limit is 35 cents per kilometer. 20 percent of sales go to Uber: Maurice leaves open whether something will be stuck for him after deducting the expenses.

Anyway, money wasn't the main motive for him when he decided to take a part-time job a good three months ago. Maurice is fascinated by the idea of ​​sharing: In his opinion, everyone benefits if not everyone, for example, has to own a car in order to be mobile.

Sharing economy: sharing via internet platforms

Passengers book the Uber transport service via an app. (dpa / picture-alliance / Jörg Carstensen)

The so-called sharing economy, as one calls the sharing of consumer goods or services via platforms on the Internet, has become a stable trend. With just a few clicks of the mouse or a couple of taps on the smartphone, you can book a cleaning help, borrow Lego bricks, swap an evening dress that has become too tight for a handbag or book private accommodation with the accommodation broker Airbnb. For more and more people this offers a welcome alternative to the conventional offer.

The concept is not new, says Daniel Veit, economist at the University of Augsburg. The origins of our business ultimately went back to partial and exchange models:

"We are, so to speak, leading a circle to the end and come back to an economy that - supposedly - works in a similar way. Because in reality most business models look very different."

Because sharing, or even common use, has long been more than a niche phenomenon in which fellow human beings do something good for others: It is a billion-dollar business. New providers, some of whom are very aggressive business practices, are constantly pushing their way onto the market. The taxi and hotel industries are currently feeling the most impact: their sales are suffering from the cheap offers on platforms such as Uber and Airbnb. The providers, on the other hand, emphasize that they only supplement old business models with innovative concepts - and thus simply make the cake bigger.

"We don't want to displace the taxi, we just want to show more possibilities," says Fabien Nestmann, Uber's head of Germany.
"If that creates a bit of competition, that's definitely an interesting thing. I'll say that for myself now, I always think it's good when there is competition."

But can we really speak of fair competition when a hotel or a normal taxi company has to meet a whole series of legal requirements, but a private room rental company or Uber driver does not? The economist Daniel Veit has doubts:

"If you look at, for example, a private car is insured for a certain amount of mileage and a certain driving style. If you take this insurance policy, which is around a thousand euros a year, and suddenly use this car as a taxi, then you are in competition Taxes that have to raise annual insurance of around 5,000 euros in order to be able to operate this vehicle in this way. "

From his point of view, it is urgently necessary to create new rules for these newly emerging economic sectors. In principle, Uber managing director Fabien Nestmann also sees it this way:

"Uber is part of a development that we have at the moment where technologies, especially technology platforms, open up or facilitate new business areas. And what is important is that you find a legal framework where such technological realities are assessed and then allowed."

In essence, providers like Uber are concerned with as little regulation as possible. You pursue a libertarian approach and see yourself as a symbol of free enterprise that should develop as freely as possible.

"We believe that the Passenger Transport Act does not take into account all the possibilities that already exist today, and that opportunities for the citizen, for all of us, cannot develop properly as they should actually be."

Airbnb: sustainable business or shortage of living space?

At the beginning of the year Berlin passed a law against "misappropriating living space". (picture-alliance / dpa / Wolfram Steinberg) Sigrid Bender opens the door to a narrow hallway that leads into a nicely furnished room. A French bed, refrigerator, toaster, microwave: for a good 30 euros per night, the Bender couple offer a room with a private entrance and bathroom on various online portals such as Airbnb, 9Flats or Wimdu. The idea for this came up two years ago when the two grown sons were out of the house.

"Yes, what do you do with so many rooms, for two people? We would have had seven rooms and two bathrooms, that's just too much."

Instead of moving into a smaller apartment, they are now financing part of the rent by subletting on a daily basis. The rental portals make this very easy: You create a profile with pictures and a short description of the accommodation, set the price per night and then just have to wait for inquiries. And they came quickly, says Sigrid Bender:

"Cologne is a student city - rooms are always in demand."

Especially since the Benders apartment is located in the popular southern part of Cologne, centrally and easily accessible by public transport from the university, trade fair or city center. The guests are mostly distance students or professionals on business trips - many come back regularly. Billing is conveniently done via the respective portal: Depending on the provider, they charge a commission of up to 20 percent. An offer from which everyone obviously benefits: The Benders, because they make optimal use of the apartment and earn a few euros on the side; the guests because they get cheap accommodation that is larger and more personal than most hotel rooms.
Nevertheless, the rental platforms on the Internet have come under fire: Especially in the inner cities of the big cities, where living space is scarce, there are more and more landlords who prefer to offer rooms or entire apartments on the Internet on a daily basis than to rent them out permanently. That is more lucrative and more flexible.

"We also have a lot of inquiries from students who want to stay longer," says Sigrid Bender.
"But we don't do that because we sometimes want to let friends live there, then we need it for ourselves privately."

Many cities are trying to legally put a stop to private subletting: At the beginning of the year, for example, Berlin passed a law against "misappropriating living space". Sigrid Bender knows how controversial the room service is: But in her case the accusation of a shortage of living space does not apply.

"Well, for us it would be that if we weren't allowed to do that anymore, it wouldn't mean that this room would be available again as living space."

After all, no one benefits from having the room empty, she argues.

Critics tend to see the expansion of consumer behavior

Providers such as Uber or the online accommodation broker Airbnb see themselves as pioneers of a new, more sustainable economy: Because not everyone is forced to own everything they need and people share many things instead, fewer resources are used. But is that really true?

Niko Paech, who conducts research on environmental economics and sustainable business practices at the University of Oldenburg, is skeptical: In his opinion, the cheap and easily available offers tend to lead to an expansion of consumer behavior:

"Because it is annoying when you want to multiply things, and things have to a) be bought and b) housed and c) serviced and looked after. And then you can increase the consumer goods inventory by outsourcing certain functions. That is "The car that I don't want to pay for or store in myself is kept by the car sharing company and made available to me."

Our economy is designed for growth, explains the scientist - and under these circumstances it is just not the case that sharing models contribute to a "dematerialization":

"It is rather the other way around: sharing models lead to a condensation of our material prosperity."

In purely theoretical terms, the "sharing economy" offers the opportunity to get by with fewer resources and money: But that only applies in a society that has freed itself from the idea of ​​growth.

"But under the current conditions, which correspond to a logic of increasing income and consumption, sharing basically only means enriching our lives with even more services and products that are made cheaper through sharing."

In plain language this means: The money that someone saves by booking accommodation with Airbnb on a trip is spent on more trips - or on being able to afford an expensive flight to the other end of the world. And the many car sharing and ridesharing offers that are springing up in the big cities compete with local public transport in particular - and clog inner cities even more.
"One speaks here of so-called rebound or boomerang effects."

Niko Paech also understands this to mean that certain offers lead to a certain consumer behavior in the first place:

"If, for example, young people who would never have had the idea of ​​driving a car because they would have had to buy the car, once they are introduced to driving, i.e. motorized individual transport, through the availability of such sharing solutions, will too Routines or mobility cultures are stimulated - or people are introduced to certain mobility cultures. "

Not all are ready to share

Mine is yours, borrowing instead of buying, sharing instead of hoarding - some still hope for a whole new economy beyond property. The American sociologist and economist Jeremy Riffkin even sees the end of capitalism in its current form approaching: In his view, it is less and less about property itself, but about quick, easy access to goods and services.

This is countered by the fact that by far not all people are ready to share - and certainly not everything. According to a survey by the GfK Association for Consumer Research, only just under 46 percent of Germans would actually borrow something instead of buying it. When it comes to sharing your own property with others, it is only around 43 percent. According to Paech, this is also due to the fact that consumption is not only related to the pure utility of the product. A car is much more than a mobile pedestal with which one can drive from A to B and transport crates of drinks.

"There is a second important consumer function, and that is of a symbolic nature, which is shaped by culture - because products are messages. The products that we call our own say something about our identity. And for this reason we experience that it is It is not so easy to cultivate sharing models or forms of community use in Germany and other advanced consumer democracies. "

Sharing: That sounds cozy and communal, like justice and social equilibrium. Still, there have long been more fundamental concerns about the economy of sharing. The economist Daniel Veit sees many positive aspects in principle:

"The only problem is that this phenomenon, which has so far represented a strong niche function, is much broader. And this widespread distribution naturally leads to side effects for society as a whole."

One of these effects is that agency portals such as Airbnb or Uber offer new tax loopholes: Who wants to control whether the landlords or part-time drivers also pay tax on their additional income? Veit also refers to the effects on the world of work: On the one hand, the "sharing economy" theoretically offers everyone a simple opportunity to become a small business owner. On the other hand, this would create largely unregulated areas that could undermine hard-won workers' rights.

Anyone who offers their labor or certain services on a platform is usually self-employed and therefore bears all the risks themselves. Collective wages, occupational health and safety, insurance in the event of illness? - Nothing. Trade unions warn of new forms of exploitation: there is a threat of a new precariat consisting of poorly paid and largely unprotected workers.

Some therefore speak of a rude "platform capitalism", which is less about customer sovereignty and self-determined networking, but more about market power and long-term profits. Many even doubt that the term sharing fits many new Internet offerings at all: After all, with the large sharing platforms it is no longer about agreeing with neighbors to use the washing machine in the basement together. Or lending someone a drill or a couple of moving boxes. It's about a tough business.

The small providers are being pushed out of the market

This is supported by the fact that here too, as in other areas of the economy, there is a trend towards market concentration. For example, Uber is backed by major investors such as Goldman Sachs and Google Ventures. The market value is now estimated at up to 25 billion dollars - that would make the transport service worth more than Adidas or Lufthansa. So far there have been many small startups in this area, according to economist Daniel Veit. But with increasing popularity, what Veit calls "economic network effects" also emerges in this area:

"These network effects mean that the 'big fish' always win and the small fish do not, so to speak, reach the critical mass to be able to play in this game at all."

The result: the smaller providers are forced out of the market or bought up.

"Which leads to a strong concentration of market power on individual players."

The consequences can already be seen: Successful platforms that provide cleaning staff or, like Uber, driving services, earn up to 20 percent of the hourly wage.

"For which, apart from providing this digital platform, they ultimately made no valuable contribution."

Uber managing director Fabien Nestmann sees it differently:

"As a platform, we have no employees, that's right - but everyone benefits from such platforms when providers and searchers are brought together faster, more efficiently and more securely."

Despite all the negative side effects: It is precisely this efficiency and simplicity, believes the scientist Daniel Veit, that the importance of the sharing economy will continue to increase in the future:

"The question will be, and that is the great challenge for our society, to meet this in a way that this does not ultimately undermine the positive achievements of our community agreements, but that it takes place in a way that creates value for us all."