The Time-Share Economy
I recently wrote about the Sharing Economy and its relevance to income inequality. I postulated when firms capture so much value that others suffer a drop in objective living standards, there is the potential for backlash.
Marc Andreessen’s tweets spurred some thoughts about the Sharing Economy and income inequality.medium.com
The original tweet (and my piece) considered a handful of Sharing Economy titans. Airbnb, Uber and Lyft were feted in the same breath. Something told me Airbnb was different, somehow better, but I ignored it as bias — because I benefit from Airbnb. Upon reflection, this was wrong.
Airbnb lets me use my home, an under-utilised asset, for personal gain. Uber lets me use my car, an under-utilised asset, for personal gain. However, Airbnb requires me to expend little labour (a few minutes per 24-hour stay) for that gain. Uber requires me to expend all of my labour (1 minute per 1 minute of driving time). Airbnb makes my asset work for me. Uber makes me work for my asset.
Sharing assets means using less capital to generate shared wealth. Cloud computing fits this model. As does public transport (the old-economy way of multiple people sharing the same asset). RelayRides are part of the Sharing Economy. Uber is not. Unless they start providing driverless cars.
Uber is part of the On-Demand Economy. Those businesses tend to rely on fully-utilising labour on mundane tasks — inhibiting that labour from progressing beyond such tasks. Whilst not part of the Shut-In Economy, Uber’s employs a similar approach to labour.
In the new world of on-demand everything, you’re either pampered, isolated royalty — or you’re a 21st century servant.medium.com
People shuffling from task to task, as dictated by their smartphone (or similar). Labour kept hidden from the sight of the privileged. Fully occupying time without hopes of self-enrichment. Echos of George Orwell’s experience living as a plongeur.
A plongeur is a slave, and a wasted slave, doing stupid and largely unnecessary work. He is kept at work, ultimately, because of a vague feeling that he would be dangerous if he had leisure. And educated people, who should be on his side, acquiesce in the process, because they know nothing about him and consequently are afraid of him — George Orwell, Down and Out in Paris and London
Such firms are part of the Sharing Economy inasmuch as they share each 21st Century Servant across multiple masters. A fascinating experiment might be to compare the cost of a modern (full-time) housekeeper/butler versus the sum of the premiums paid for all those on-demand services. Although I suspect putting a human face to their convenience might be unpalatable for its most avid consumers.
What are the implications for my original article?
Anecdotally, one presumes firms contributing to the On-Demand Economy are far closer to the peril of lowering absolute living standards (should such peril exist). Hence inklings of backlash from those championing the rights of labour — unlike Airbnb where the backlash is from those championing the ‘rights’ of business and governments. Will supply constraints force On-Demand businesses to attract labour through a living wage? If not, firms may be compelled to by government or (one hopes) public opinion.