Sharing Economy - blessing in the digital age?
Definition and explanation
27 August, 2021 by
Sharing Economy - blessing in the digital age?
manaTec GmbH, Sophia Grünig

We usually look forward to summer - after all, many people enjoy their vacation during this time of year. But this year, the popular part of the year was not only complicated by the ongoing COVID-19 crisis, the summer of 2021 with its weather extremes is causing discussion worldwide and will go down in history.

Whether heatwave and accompanying forest fires in Greece, Turkey and Italy, floods in China, heavy rain and floods in Belgium, the Netherlands and Germany - the weather extremes have claimed many victims and destroyed belongings. Overwhelmed by the events, not only did numerous aid workers travel to the crisis areas to help rescue and rebuild destroyed infrastructure and homes, but many helpful fundraising campaigns also emerged - both locally and digitally.

Sharing and giving is not only a phenomenon in times of humanitarian catastrophes, but an increasingly used consumption concept with all kinds of future potential. Both in the discussion about sustainability and about digitalization and networking, which have already been looked at in our blog, the keyword sharing economy can be found again.

Whether sharing, swapping or gifting - sharing economy involves various forms of consumption.
Whether sharing, swapping or gifting - sharing economy involves various forms of consumption.

But what exactly is the sharing economy and where did it originate?

The sharing economy - often also referred to as the "shared economy" and translated as the "economy of sharing" - is also known in the English-speaking world as "collaborative consumption" and "collaborative economy" and is a collective term for a wide range of joint forms of consumption. The elementary content of this consumption concept is the collective use of goods, spaces and areas through sharing, swapping, lending, renting or giving away - especially by private individuals and interest groups - as well as the mediation of services. As long as goods are usable and available, they change users or owners, while maintenance and repair are usually the responsibility of the owner.

The origin of this form of consumption can be found in the cooperatives that sprang from agriculture, and since then numerous such concepts have existed in various forms, be it libraries and video stores, car rental, ride-sharing centers, laundromats or ski rental. The basic motivations of these approaches are originally both social and ecological - they are about effective and sustainable use of limited resources and growing cohesion in society. Views and attitudes critical of consumption and growth are also often both the basis and the foundation. Property is seen not only as an enrichment, but also as a potential burden.

Increasingly, commercial intermediation services in particular are coming to the fore in the public discussion surrounding the term sharing economy, especially in the transportation and tourism sectors. Whereas in the past, the consumption forms of the sharing economy were often accompanied by elaborate and time-intensive processes and thus had a limited scope, advancing digitalization and networking and the accompanying technological innovations are creating new dimensions and ranges. In this context, social networks and electronic venues play a significant role in reaching the largest possible group of interested parties.

In turn, the role companies play in the sharing economy depends entirely on their business model. While in the peer-to-peer (P2P) business model, companies merely provide the technical infrastructure in the form of platforms through which users can then exchange information, in the business-to-customer (B2C) business model, companies use the technical possibilities to make it convenient for their customers to use their products and services. In the business-to-business (B2B) model, for example, companies lend products to other companies to save on acquisition costs and expert advice. The B2B and B2C business models have been present in the sharing economy for quite a long time and are accelerated and simplified by technological innovations. The P2P model, however, is newer and brings new dimensions as well as opportunities and risks to the sharing economy in the digitized age.

One does not have to think long to find current applications for the digitized sharing economy. Whether flat sharing with AirBnB, car sharing with TeilAuto, food sharing with To-Good-To-Go, media sharing with Netflix, information sharing with Wikipedia or numerous digital flea markets such as Ebay Kleinanzeigen or Vinted - examples can be found enough and show how extensively the "sharing economy" is integrated in our digitalized and networked society.

Next week, in the second part of the blog series "Sharing Economy – Blessing of the digital society?" , we will take a critical look at the opportunities offered by the sharing economy in our digitized age and the risks that need to be considered.


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