Sharing in the hype: the collaborative economy and motivation

Ironic that today in the financial press we read that a judge has banned Uber from operating in Spain (although not really, see Enrique Dans’ article), and we read about the launch of Sharing España, a “collaborative economy” association. The objective of the new association is to represent the sector’s interests, and to convince users of its efficiency and security. And Uber, poster child of this new economic activity, is not invited.

Sharing España

One of the participating companies, Cabify, whose image decorates the Sharing España article (and of which I am a happy client), competes with traditional taxis in that its prices are on the whole lower and its cars are nicer. It has a convenient booking app, but so do several other taxi companies. It lets you pre-book, and the payment is automatically and conveniently taken from your credit card, as with other taxi companies. Cabify operates in several Spanish cities without legal problems, and has passed several inspections. The difference between Cabify and Uber is that Cabify’s drivers have the requisite chauffeur licences (which cost a fraction of the taxi licence price). The similarities are mainly that Cabify’s drivers are independent contractors who own their own cars. They don’t “work for” Cabify, they “collaborate”.

I’ve said before that I think that the “collaborative economy” is badly named, and I stand by that. Cabify drivers, EatWith chefs and Myfixpert technicians are selling their services, their time, their effort… It’s a commercial transaction. In general they receive a fixed, market-based amount for their efforts. In a collaboration, economic or otherwise, you work together to produce a result, which you then get to share. The participants in the “collaborative economy” companies collaborate in generating the platform’s profits, but they don’t get to share them.

image by Sylwia Bartyzel via Unsplash

image by Sylwia Bartyzel via Unsplash

However, collaborative economy is a much better name than “sharing economy”, and why the founding members chose to call the association “Sharing España” is beyond me. It sounds innovative and kind, which should appeal. But it is misleading, and that almost always backfires.

Calling it “Sharing España” is buying into the hype. In case you doubted that there’s a lot of hype, here’s venture capitalist Shervin Pishevar: “This is a movement as important as when the web browser came out.”.And take a look at these headlines: “Sharing Economies are Here to Stay”, from the Guardian. “The Rise of the Sharing Economy”, from the renowned Economist magazine. And I got the Pishevar quote from an article in Forbes, a usually serious business magazine, called “Airbnb and the Unstoppable Rise of the Share Economy”. A magazine of that level should know that nothing in the economic world is unstoppable, especially after the economic crisis that the developed world has been clawing through. Wasn’t it hype that got us there in the first place?

Take the case of Airbnb. They started out in 2008 by advertising floor space in their apartment during a trade fair that had flooded the city with cash-strapped creative types. They had space for three airbeds (yes, that’s where the name came from, Airbedandbreakfast), which they managed to rent out. Is that a new business? No! Could they have done that without the Internet? Yes! A few flyers taped to lampposts around the area and pinned to bulletin boards in coffee shops would no doubt have produced the same effect. Were they sharing? No, they were renting out space. A commercial transaction.

And that’s the key. Sharing should not be commercial. Sharing is worthy, valuable, and gives benefit to the sharer and the sharee. But it should not have any motive other than the satisfaction of doing the “right” thing, of being kind.

In 1995, two Swedish economists launched a motivation experiment that had unexpected results. They visited a clinic in Gothenberg and divided the potential blood donors there into three equal groups. One group was told that they could give blood if they wanted, it would be appreciated. The second group was told that they would be paid 50 kronor to give blood. The third group was told that if they gave blood, 50 kronor would be donated to their favourite charity. Interestingly enough, the number of willing donors in the second group dropped significantly. Offering an economic incentive “tainted” an altruistic act, and the participants lost interest. Simply “doing good” was enough motivation for the first and third groups. And that’s my main point. Sharing is good. Let’s not taint it by equating it with a commercial transaction.

Sharing, empathy and honesty are the three main pillars of childhood values. And yet, of the three, sharing is the only one whose definition is being re-engineered by the media (in most cases at the behest of the businesses) to create buzz, generate hype and coin sound-bites. We’re doing ourselves a disservice. Hype can generate some short-term attention, but it generally fizzles out to the catchy tune of “I saw it coming” and “I told you so”. And the damage is not just limited to the number of closed businesses, the millions of $ or € wasted on buzz-based funding, and the subsequent prejudice against valid businesses that got tainted with the hype brush. The price will also be paid by education, values and society as a whole. I can so see little kids in the playground, when being urged to share, ask “what’s my percentage”?

We need to reclaim the word “sharing”, to give it back its generous meaning. That would generate a benefit for current and future generations, which we could all actually share.

 

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If you’re interested in more stuff about the Sharing Economy, check out my Flipboard (and yes, I did, I called it “Sharing Economy”):

Flipboard magazine on the Sharing Economy

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