In general, sharing economy is a hybrid market model which refers to peer-to-peer based sharing of access to goods and services.
Based on Investopedia, a sharing economy is an economic model in which individuals are able to borrow or rent assets owned by someone else.
Some called sharing economy as “Collaborative Consumption”, “Peer-to-Peer Economy”, “On-Demand Economy”, “Gig Economy”, “Access Economy”, “Circular Economy”, “Peer Economy” and or “Exchange/Swap Economy”.
The Sharing Economy
is a socio-economic ecosystem built around the sharing of human, physical and intellectual resources. It includes the shared creation, production, distribution, trade, and consumption of goods and services by different people and organizations. It refers to the use and access of goods instead of their possession.
The sharing economy forms:-
- Redistribution systems: Resource distribution systems in which individuals may provide and obtain resources permanently, either for free or for a fee.
- Mutualisation or Access Systems: That englobes loan or borrowing and short term rentals. There are less product available but the potential life improvement is bigger.
Impact of Sharing Economy – Journey of sharing economy is not so bigger, but within a course of time, it impact is huge and can be a part of one’s day to day life.
- Environmental: Indeed, by various forms of share, the goal is to reduce environmental impacts, by reducing trash or production for example.
- Economic Impact: This is one of the first motivation for users to share. Collaborative consumption can have a significant impact on revenues. It allows to save up by buying cheaper or to earn money by selling. It creates also lots of employments in some sectors. The majority of people think that is a solution to the crisis.
- Social Impact: This takes a very huge place too. It is often more than just a product, it is lots of advice in addition to the share, it is also an experience and a way to meet new people who may also share your ideas.
Lower Costs and Greater Flexibility
The advantages of the sharing economy seems obvious. The customer incurs lower search and transaction costs. One click on the app is enough to establish the availability of a local driver, household appliance or even doctor. Usually the price for the item or service is significantly lower than for ‘traditional’ alternatives. From the supplier’s point of view, the sharing economy means more flexibility – the ability to products or services whenever and wherever the supplier desires. On a macroeconomic level the sharing economy means more efficient use of resources, and a more sustainable way to consume products.
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