Occupy Wall Street broke a silence. What was long only whispered between friends was shouted from the centers of hundreds of cities across the globe — that a grand economic experiment has failed. A gaping chasm has opened up between the rich and the rest, and citizens no longer believe that widespread prosperity will be achieved through the growth-centered economic policies of decades past. Moreover, these policies also mean ecological suicide. Thus, Occupy Wall Street signals the beginning of the end for the troubled experiment that was prosperity through growth.
While the year-old Occupy movement struggles for relevance and impact, a years-in-the-making economic experiment is underway, one that could change cities forever and deliver on their promise as crucibles for positive social transformation. Like Occupy, this experiment takes its cues from the modality of the Internet. However, it translates this into new way of managing society’s assets at the city scale, rather than relying on a national political agenda.
The “new” mode is so intuitive, so effective in meeting human needs, so natural to humans that it won't need the trillions in advertising and government support required by the old guard’s experiment. It’s a child’s earliest moral lesson; every major religion teaches its wisdom. Today, the Internet and the many digital commons it spawned re-teach the lesson to those who forgot it. It’s the default logic of Gen Y, the first generation raised on the Internet. This “new” experiment is prosperity through sharing.
Occupy Wall Street protesters fill Liberty Park in New York City in October of 2011. Photo credit: Aaron Bauer. Used under Creative Commons license.
The very notion of prosperity is being redefined by a new generation. It no longer means McMansions, SUVs, and Rolexes — baubles which Millennials watched their parents destroy themselves over. Many want something different, and most couldn’t afford the old dream anyway, even if they wanted it. In this new experiment, prosperity is defined by healthy relationships, realizing one’s creative potential, civic participation, meaningful experiences, and purposeful work — all things that actually deliver happiness.
In a sharing economy, products connect us rather than operating as status symbols that divide. Here product service systems and time-tested urban commons like libraries, parks, streets, and public transportation make our daily needs widely accessible. Here access trumps the burdens of ownership. Here we stop destroying our planet chasing a manufactured dream.
Instead, we come home to where prosperity has long been centered — within the vital relationships forged in our homes, neighborhoods, and cities. It’s no accident that Gen Y is flocking to cities in what is the greatest migration in history. But there’s an epoch-making twist beyond these shifts: the Internet widens the circle of sharing beyond family, tribe, and nation to the global scale.
This may sound like the fantasy of an idealist, but scores of new companies have emerged recently to help strangers share a surprisingly wide variety of assets — mostly in cities, the perfect platform for sharing. They include Airbnb and Tripping (rooms and apartments); Loosecubes and LiquidSpace (office space); RelayRides, Getaround, and Wheelz (peer car sharing); Techshop and hackerspaces (industrial workspace); La Cocina (commercial kitchen space); ParkatmyHouse and Park Circa (parking space); Zimride, Sidecar, and Ridejoy (ride sharing); SharedEarth and Hyperlocavore (garden sharing); Grubwithus (restaurant dinners); Vayable (experiences); Skillshare and TaskRabbit (skill sharing); Thredup (childrens clothes); and Yerdle (general).
This list just scratches the surface. Lisa Gansky, author of The Mesh: Why The Future of Business is Sharing, has identified thousands of such startups. Many are currently small, local, or struggling; others have substantial user traction, funding, and national or international reach. Meanwhile, as Rachel Botsman, author of What’s Mine is Yours: The Rise of Collaborative Consumption, states, bike sharing is the fastest growing form of public transportation. The largest program, in Hangzhou, China, has over 50,000 bikes. Car sharing is also undergoing a global boom.
The rise of these services is an important signal that net culture is becoming dominant. The values and practices of social web are now being used to manage our relationships and assets in the real world. Smartphones turn this into a location-specific, real-time, on-demand affair.
An Internet cafe in Taipei -- evidence of the global connectedness. Photo credit: Jared Tarbell. Used under Creative Commons license.
The sharing economy turns consumer culture on its head.
This is a world where we help each other realize our creative potential, instead of judging each other by what we buy. Where a good online reputation provides more access to resources. Where the more you contribute to the common good, the more you’re respected. Where we host, fund, teach, drive, care, guide, and cook for friends and strangers alike with little to no mediation. This is a world where we help each other. To paraphrase Brian Chesky, CEO of Airbnb, we used to keep up with the Joneses, now we share with them.
The last half of the 20th century witnessed an experiment to expand freedom through privatization and a diminished welfare state. Instead, it enslaved billions of people through debt. That experiment turned out to be just as oppressive as state-managed economies, if not more. In this century, we’re trying a third way — a way beyond market and state. Through networks and commons, we’re opening the world to one another on a peer-to-peer basis, and a new level of freedom is being realized through our social obligations rather than despite them. This is, indeed, a brave new world.
The positive dynamics of car sharing suggest the possible impact should these services prevail and restructure the economy in favor of access rather than ownership. Car sharing is now a decades-old archetype within the sharing economy, only truly coming of age recently thanks to mature technology, a global reach, and the first publicly traded car-sharing company, Zipcar, which went public earlier this year. With maturity comes evidence of sharing’s impact:
A 2010 UC Berkeley survey of 6,281 North American car-sharing members showed that over 50 percent of households joined to get access to a car who didn’t already have access to one and that the total vehicle count in the sample dropped by 50 percent after joining.
The same study showed that one car-sharing vehicle replaces 9-13 owned cars.
A 2011 eGo car share study showed that member car travel dropped an average of 52 percent after joining.
The American Public Transportation Association estimates that people save an average of $9,900 a year for each car eliminated from a household.
The Intelligent Cities Project estimates that a city could keep $127 million in the local economy annually by reducing the number of cars owned in a city by 15,000.
Car sharing, the gateway drug to the sharing economy.
While more research needs to be done to understand the impact of sharing, these statistics suggest that a city can significantly broaden citizen access to resources, dramatically reduce resource consumption, and strengthen the urban economy all through one simple, low-cost strategy: sharing. Social entrepreneurs need to take note of sharing as a systemic intervention in a world of bandaid solutions.
Furthermore, car sharing is not just the archetype of the sharing economy, it may also be the gateway drug. Shareable Magazine and Latitude Research’s “The New Sharing Economy” survey found that car sharers share across significantly more asset categories than non-car sharers. The model of car sharing could be the future of our most important assets. Here, our material reality is reordered according to the architecture of the Internet, arguably the ultimate commons. Here, nearly everything becomes available to nearly everybody from the cloud at a low cost, on a pay-per-drink basis. Assets do not idle. We use only what we need when we need it. No waste. No want.
Traffic accounts for 365 hours commute time of your life per year. Photo credit: Johnny Ainsworth. Used under Creative Commons license.
This future is not assured.
For maximum public benefit, sharing services should be complemented by other low-cost, low-tech ways to enable sharing, such as cooperative enterprises, exemplified by the 80,000 worker-owners of the Mondragon cooperative in Spain. Commons-based urban development as exemplified by Enrique Penalosa’s transformative investments in public parks, schools, and transportation when mayor of Bogota, Colombia, should also play a crucial role. In addition, the sharing economy must be fought for in the courts and halls of government. Just as peer-to-peer car-sharing companies needed to change laws for neighbors to share cars, so must other sharing enterprises. Just as the growth economy depended on a particular regulatory framework, so will the sharing economy.
Today, some of the most successful sharing services operate in regulatory gray areas. In the U.S., most local laws do not guarantee you’ll keep your insurance if you rent a car to a neighbor, nor do they allow you to sell vegetables grown in your backyard, operate a for-profit ride-sharing service, or offer a spare room for short-term rental. This list goes on.
The sharing movement must do something much more difficult than building anew to obsolete the old — it must hack the law to allow the new to emerge. This process may be easier than it sounds. It can be done city by city. The doors of city halls are more open than those of national governments, and the benefits will manifest most dramatically there.
A new, more joyful and sustainable way of life is within reach. It will have to be fought for, but it’s worth fighting for, because in this way of life, everyone wins, not just the 1 percent. And while many have woken to the potential of cities as crucibles of transformation, they have not fully awoken to this truth: cities will not save humanity until they’re conceived as networks and commons, as places to collaborate and share.
A version of this first appeared in the December 2011 edition of SPUR's "The Urbanist" magazine.