Abstract worker-related litigation, a 2015 study shows that its

Abstract

Recently,
the world has witnessed the emergence of an umbrella term that is often called
“the sharing economy”, which has attracted a great deal of attention in the
past few years.

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This
phenomenon is spreading rapidly worldwide in a number of industries and markets
and across countless domains in various formats.

This
phenomenon has drawn mixed responses, supporters of the sharing economy claim
that it can yield idealistic outcomes including global equality and sustainable
consumption practices. Critics condemn the idea of the sharing economy itself
as an attempt to commercialize aspects of personal life previously beyond the
reach of the market.1

 

Introduction

The
sharing economy seemingly comprises online peer-to-peer economic activities.
The most wildly publicized and talked about domains are rental accommodation,
mobility and gifting.2

The
rapidly increasing interest in the sharing economy is highly credited to the
success stories of sharing economy platforms such as Uber, an online
peer-to-peer platform providing taxi and ‘ridesharing’ services. These platforms
experienced explosive growth from a small independent start-up company to a
multi-billion-dollar international corporation in an astonishingly short amount
of time.3

Despite
the fact that Uber is frequently charged with unfair pricing practices and
worker-related litigation, a 2015 study shows that its active driver base has
more than doubled every six months from 2013 to 2015.4
Its growth continues to rise in 2017 as the latest confirmed financial results
of Uber showed that the gross bookings roughly doubled from the 2nd quarter of
2016.5

With
the economic benefits that the sharing economy can bring and the frequent
reminders about the problems it poses, further examination is required to
determine whether the sharing economy is a blessing or a curse.

Using
UBER as an example, I will explore in my research paper both the advantages and
disadvantages that the sharing economy provides in the field of transportation.

I
will begin with a brief review of what the sharing economy is. I will then move
on to introducing Uber and how it works, then I will discuss its impact on the
the field of transportation, specifically the taxi industry. I will conclude
with answering the question I posed earlier.

 

What is the sharing economy?

It
is not an easy task to offer a definition of the ‘sharing economy’ which
encompasses the variety of ways in which the term is used in practice6.
 It has been described as a marginal phenomenon,
but the act of sharing itself is not new, sharing practices are the foundation
of community life and human according to Thomas Widlok, who explores the term
“sharing” through the ages7.
Furthermore, the common sense meaning of sharing doesn’t include forms of
exchange that one or more parties can benefit from, and with that, innovations
based on peer-to-peer asset rental (e.g. Airbnb and Uber) should be excluded
from the sharing economy. However, they are forefront runners of this
phenomenon.

Adding
to the complexity of defining the sharing economy are overlapping terms such as
collaborative consumption8
and collaborative economy9.

 

For
my research paper I will use the definition coined by Botsman: the sharing
economy is an economic system based on sharing underused assets or services,
for free or for a fee, directly from individuals.10

 

What is Uber?

According
to times magazine, Uber is” … an Android, iOS and Windows Phone app
that connects riders with drivers using their phone’s GPS capabilities, letting
both parties know one another’s location and removing the question of when the
ride will actually arrive. In addition, the tech company also processes all
payments involved, charging the passenger’s credit card, taking a cut for
itself (which ranges from 5% to 20%), and direct depositing the remaining money
into the driver’s account, all in the background and completely cashless.”11

“Uber
capitalizes on convenience. In order to do so, it identifies idle capacity,
aggregates it and allocates it to consumers who are willing to pay the price.”
It acts as a matchmaker between offers and needs, and it does that at lower
costs, which generates value-add for customers.12

Uber
is in many ways similar to traditional taxi services, but it has made
structural changes to this old industry that functioned much the same way it
did decades ago, while people in need of a cab had to stand at a street corner
and physically wave to hail a cab, or call the local taxi service to reserve a
car at least half an hour prior to the pickup time, Uber and its competitors
have made it possible to secure a car or taxi from any location at any time
through a smartphone.

Needless
to say, these changes had both positive and negative impacts in the field of
transportation in general and on the taxi service industry in specific, so in
the next paragraph I will be examining these impacts.

 

The Impact Of Uber:

A
frequent belief is that the rise of the “sharing economy” has led to the
displacement of workers in a wide range of traditional jobs, in this case, I will
examine the impact of the flagship of the sharing economy -Uber- in traditional
taxi services.

1 Widlock. Thomas

2 The people who share

3 LASHINSKY, A. 2015. Uber: An oral
history Online. Fortune. Available:
retrieved (12.11.2017)

LASHINSKY,
A.” Uber: An oral history”. Fortune, June 3, 2015 retrieved (12.11.2017)

4 Solomon, B. “The Numbers
Behind Uber’s Exploding Driver Force,” Forbes, May 1,2015

retrieved (12.11.2017)

5 Helft, M. “Despite Ongoing Turmoil,
Uber’s Growth Remains Strong”. Forbes, AUG 23, 2017 < https://www.forbes.com/sites/miguelhelft/2017/08/23/despite-massive-turmoil-ubers-growth-remains-strong/#3a1e06dcc764 > retrieved (12.11.2017)

6 Schor, J.” Debating The Sharing
Economy”. October 2014 < http://greattransition.org/publication/debating-the-sharing-economy#what-is-the-sharing-economy > retrieved (8.12.2017)

7 Widlok, T. “Anthropology And The
Economy Of Sharing”

8 collaborative consumption, which is
defined by Botsman and Rogers as sharing, bartering, swapping, lending,
trading, renting, and gifting, redefined through technology and peer
communities, changing both what and how we consume. Botsman, R., and Rogers, R.
(2010): What’s Mine Is Yours: The Rise of Collaborative Consumption. Harper
Business

9 Collaborative Economy: An
economic system of decentralized networks and marketplaces that unlocks the
value of underused assets by matching needs and haves, in ways that bypass
traditional middlemen. Examples are: Etsy, Kickstarter, TaskRabbit. Botsman, R.

10 Botsman, R.

11 Patrick Pullin, J.” Everything You
Need to Know About Uber”. Time, November 4, 2014 
retrieved (2.12.2017)

12
The uber book