Advantages, Challenges and the Future

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Need to find accommodation while traveling? Nowadays, in addition to booking hotels, we can also use online platforms like Airbnb to stay in rooms rented out by others. Need transportation? You’ll use a mobile app to hail a ride or use a shared bike instead of calling a taxi. As can be seen, with the rapid development of technology, the sharing economy is changing how we live. It typically makes use of information technology and the Internet to encourage the distribution, sharing, and reuse of excess commodities and services production capacity. By sharing resources and services, consumers in this new model can achieve more efficient and convenient consumption. However, for consumers, the impact of the sharing economy is multifaceted. This article will investigate the benefits of the sharing economy to customers and potential problems and will analyze future development situations and draw conclusions.

Benefits of the sharing economy to consumers

1. Improve consumption efficiency

The sharing economy model can help customers better use and share resources, boosting resource usage efficiency. Sharing economy firms, like Uber and Airbnb that connect customers and suppliers can achieve higher efficiencies than traditional enterprises. This sharing economy model allows consumers to use goods or services without purchasing them, thereby reducing costs and improving usage efficiency.

2.Promote people’s communication

With the advent of internet platforms, sharing with strangers has become more desirable. Strangers meet face-to-face after going through a matching process on some platforms, and this face-to-face contact is thought to create new social connections (Frenken & Schor, 2017). The sharing economy emphasizes trust and common interests. People can share items through a sharing platform, enhancing intimate and interactivity.

3.Increase income and employment opportunities

Unlike the employment relationship under traditional economic production relations, the sharing economy has brought about a liberalized employment model of production labor, increased job opportunities for workers, and increased workers’ income. Sharing economic products such as shared bicycles and vehicles necessitates a considerable quantity of staff to maintain and operate, resulting in more job possibilities. Building more sharing initiatives can also give people business chances and rewards. At the same time, customers can use shared economic models to replace traditional transportation methods, lowering transportation fee and freeing up funds for other purchases.

4.Increase choice diversity

The sharing economy uses the Internet and mobile technology to provide consumers with idle resources, technologies, and services and expands the scope of product supply. It makes it easier for consumers to access different items and services. At the same time, the sharing economy provides more transparent information through the Internet platform, allowing customers to understand better the specific content and feelings of goods and services. This enables consumers to make more informed purchasing decisions and select goods and services that better meet their needs.

Lime

Lime is a transportation company headquartered in San Francisco, California. It operates e-scooters, e-bikes, and e-mopeds in various cities worldwide. The reporter demonstrated how to use sharing bicycles in the video. When a user installs the Lime app on their smartphone, all available cars in the area are displayed on the app. Users must provide payment details before starting their journey. The user then scans the QR code on the vehicle to start the trip, which is a straightforward process. When it ends, the car can be parked anywhere without finding a parking lot or paying any parking fees. This significantly saves consumers the time and cost of finding a parking space. It also enhances connectivity in outlying suburbs that are underserved by regular public transport, making communities and cities more equal and providing more transport options.

In addition to convenience, shared bicycles also have other advantages. The first is the environmental benefits. Cycling is excellent for the environment because it allows people to travel without releasing toxins and burning fuel. People who use bike share programs may not use transportation like cars. This sharing model reduces the need for individuals to purchase bicycles, thereby reducing resource consumption and the generation of abandoned vehicles. Cycling is also an activity that has numerous health benefits. Customers can exercise and become healthier by riding on communal bicycles. Moreover, an essential point is the cost advantage. Compared with private vehicles or taxis, shared bicycles have lower rents and do not need to buy their cars. This attracts consumers who only move short distances within the city. This dramatically reduces their travel costs.

Although shared bicycles bring many conveniences, they also have some disadvantages. Collecting deposits from users is a standard operating model for shared bicycle companies. However, the market competition is fierce, and some eliminated companies have consistently refused to return user deposits, leaving users to suffer losses. At the same time, when using shared bicycles, users must download the corresponding mobile application and provide some personal information for registration and payment, which risks personal privacy leakage. In addition, there may also be problems such as unstable service quality and restricted service areas.

To summary up, shared bicycles, as an emerging mode of travel, have both benefits and drawbacks. While enjoying its convenience and benefits, consumers should also pay attention to and solve the problems and hidden dangers it brings. At the same time, this example also shows that the sharing economy has advantages and disadvantages for consumers.

Disadvantages of the sharing economy to consumers

There are several “dark sides” to the sharing economy, namely economic, social and environmental externalities that affect stakeholders(Mosaad et al., 2023).

· Lack of guarantees and responsibilities: Sharing companies lack supervision, and protecting consumers’ rights and interests in the sharing economy may be more difficult.

· Privacy issues: Consumers must provide personal information to the platform, which may be misused or leaked, posing privacy risks to consumers.

· Unfair competition: The market competition in the sharing economy is fierce, and some unscrupulous companies may use unfair means. This unfair competition may harm the interests of consumers and lead to market chaos.

Airbnb

This video explains how Airbnb came to be and its current problems. Airbnb is a sharing economy business，it is an online short-term rental platform that connects unused properties with tourists in need of short-term accommodation through the Internet. Airbnb offers many benefits to consumers by providing a wide selection of listings, unique experiences, a quick and easy booking process, and lower prices. But there are also some disadvantages.

First , there is a lack of supervision of the houses on Airbnb. They are not subject to city rules and regulations because they do not own real estate or employ hotel staff. Only “Hosts” and “Guests” may connect online through the site (Van, 2018). This may lead to fraud and false listings. Although Airbnb checks and manages listing information, some listings may have problems such as inflated prices, incorrect locations, and steal pictures, which deceive users. In addition, Airbnb seen as a threat to safety and affordability of residential communities (Cheng, 2016). Though its rooms have been professionally cleaned and disinfected， there may still be health and safety issues that affect consumers’ living experience and health. Moreover, there are privacy and security issues, and consumers’ privacy and security are easily compromised by living in someone else’s house. Unlike traditional hotels, Airbnb hosts may have access to guests’ personal spaces, which is highly unsafe.

In a word , Airbnb brings many conveniences and benefits to consumers, but there are still some potential downsides. When choosing and using Airbnb, consumers must be vigilant and carefully identify information online to obtain a better accommodation experience and protect their rights and interests.

The future of the sharing economy

The sharing economy is expected to grow significantly and may provide important answers to sustainability challenges (Räisänen et al., 2020).

· Platform will be further subdivided into more specialized areas
· Integration of the sharing economy and traditional industries
· More innovative sharing economic models emerge
· More excellent application of machine learning and artificial intelligence technologies

Summary

For consumers, the sharing economy has both advantages and disadvantages. The benefits are primarily reflected in improved resource utilization, lower consumption costs, increased choice diversity, higher income levels, and enhanced social interaction; the disadvantages are mainly reflected in uneven service quality, insufficient information transparency, and imperfect laws and regulations. Facing the future, the government and all sectors of society need to work together to strengthen supervision and regulation，consumers also need to improve their ability to discern information to promote the healthy development of the sharing economy.

Reference

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