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Sharing economy – a view from SEFA Conference 2016

On 20th of September SEFA conference was held in Amsterdam in order to find out what Sharing Economy is, how is it applied in our society and what future it faces as a new economy model.

Several speakers were invited to the event and this article will guide you through the conference with speakers information and the most crucial points of their presentations.

The first speaker to be giving his speech was Harmen Van Sprang, a co-finder of ShareNL, which is a Dutch network for the collaborative economy. He started his presentation with giving examples from personal life, that actually answer the question: What sharing economy is? One of such examples is a concept of “home sharing”. Simply speaking, you just exchange houses with another family/person for a certain period of time. You do not need to pay anything, as this experience is beneficial for both of you. Another example of sharing economy can be AirBnB or Uber. Nowadays, there are more and more start-ups, that are based on a sharing concept. Moreover, government and already famous corporates are trying to renovate the existing business model by implementing sharing economy. Speaking about ShareNL, the goal of this company is to provide society with information, through media, presentations and summits and also helping businesses to implement the concept of sharing. Harmen Van Sprang believes that sharing economy can lead to sharing society, which results in everyone having access to everything they need. Dividing economy into traditional and collaborative (sharing) is a topic that was discussed by several speakers during the conference, so the discussion of it will appear in the article later on. From Harmen’s point of view, the advantages of sharing economy over traditional are 3 words: social, sustainable, saving money. Going in depth, social advantage means that people are communicating with each other personally, sustainable means that this economy exists because of peoples willingness in the first place, as it directly works as demand-supply. Finally, saving money means that sharing a car ride or renting your car out for a day or two, for example, brings one person additional profit and the other one saved budget. One of the key points of this type of economy is using what we are already offered in a more sustainable way. This concept is highly flourishing in Amsterdam, as it is now named (along with Seoul) City of Sharing.

The second speaker to be presenting was Michael Visser – founder and CEO of Konnektid, a platform that allows people to share knowledge and skills in their neighbourhood. Speaking about his personal experience and the idea of Konnektid coming to him, Michael Visser claimed that university education is a closed and centralized system, when it should be personalized and be a life-long experience. The key point of this speaker was that sharing economy does not end on the physical assets, but it can be extended to sharing personal experience and knowledge with other people. Next speech was made by Jan Jonker – professor at Radbound University. He gave a more theoretical background on the term “sharing economy” and supported the key concepts stated by previous speakers.

The main question that collaborative economy is asking is: “How people can create economic activity among themselves?” Sharing economy, in words of Jan Jonker, connects two ways of thinking, which result in asset becoming a collaboration. The key point of the new economy is organizing shared value, or, in other words, value creation. This means, that people themselves have the capability of creating an economic value, using their own assets, by simply sharing them with others. Several drivers of sharing economy are mentioned: personalized, enabling technology, availability, affordable and reliable. These terms combined give a perfect environment for developing of collaborative economy, and are also the main pulses of this type of economy at the same time. The opinion of Jan Jonker is that this type of economy is here to stay and it will be developing and growing each year, gradually replacing the traditional economy. However, he stated that traditional economy will still have place in the modern world. More information can be found in Jan’s book.

The first female speaker of the event, Carlien Roodink, openly shared her personal experience with establishing a platform that would strengthen the interrelationships between humans. She was largely inspired by the fureai kippu currency of Japan that was first created 20 years ago, where local citizens could earn their artificial credits by helping out elderly people in their neighborhood; which could be transferred to their own personal usage in the future. WeHelpen, an initiative created based on this idea, was formed to construct a network of shared community where any kind of assistance could be found directly on its website. Registered users could either ask for support or even actively seek to help others in the community in which they will be legitimately compensated for their own work. With the ongoing development of the Internet, numerous major breakthroughs in technological advancement are enabling the shared economy to exist and operate, as reaching out to people is now is now just as easy as at your fingertips.

Another highlighted example of utilizing technology into making shared economy possible is the invention of SnappCar application. Pieter van den Wall Bake, community supporter of the company, described that cars are also underused assets which needs to be more fully utilized, thereby decreasing CO2 emissions arising from car production, saving spaces for cities, and improve the automobile efficiency as cars are less being kept idle. However, this idea would not be made possible without the fundamental economic principles that modern-day economists take into account: trust. While mutually benefiting from trust, as he explained, the psychological side of this feeling of security between strangers is also to keep people more engaged and making themselves spiritually more youthful. People are now becoming more conscious about the world and their influences that each individual created on it; therefore stepping forward is inherently essential to the existence of future generations. The current economic global challenge is how to deal with sustainability, and as such, sharing economy is taking its first steps towards answering that problem.

Sharing economy has always been around us over the course of history, and we are somehow unconsciously doing them every day, Koen Frenken – Professor in Innovation Studies at the Copernicus Institute, asserts. However, rather than an informal and small-scaled economy, the real sharing economy that is often discussed nowadays are between any economic agents, which is facilitated by the use of Internet. Security is also ensured as well, either by the infamous rating systems on numerous mobile phone apps, or through other alternatives such as insurances and guarantees. He discussed the evolution of the shared economy will start to unfold, where in the future businesses stepping in to the industry will benefit substantially by the transition of a consumer-to-consumer basis to a consumer-to-business-to-consumer (C2B2C) model. Although this remains a heightened political debate of creating a balance between traditional economies and these newcomers, we are definitely seeing a positive development of sharing economy, not just for private profits (increased welfare), but also planet (decreased pollution) and people (more socialization). In his research, sharing economy induces an odd process called ‘“reverse” technological assessment’; i.e. only when the industry is considered growing then the legal framework can be built, subsequently a normative debate about it, and finally scientific researches.

So after all of the happenings during the rise of the sharing economy during the past decade, what are political institutions reacting to the unanticipated success of these business models? Marja Ruigrok, VVD party chairman of Amsterdam, agreed with the statement of the city of Amsterdam for encouraging and embracing these sharing initiatives. A pro-active, open mindset and cooperation would both mutually beneficial for the businesses and the governments in building an entrepreneurial and innovative Amsterdam. Despite having consented to a common framework to deal with the uprising economy (which could be found on municipality website), the role of the government is to create an equal playing field for all entrepreneurs, so it is in need of the government to do more research, understanding the mechanisms of sharing economy and connecting related partners and entrepreneurs to form a network to build a common discussion platform for the benefits of all involved parties. Local authorities have also initiated other projects such as sharing its own knowledge to businesses or even sharing its own physical assets (such as car-parking spaces or office buildings) to those in need. In addition, a cooperation with renowned international businesses such as AirBnb for holiday rentals, with a threshold of maximum 60 days per year for renting out, is also being implemented. However, the challenges remains on the stability of other economic variables, for example ensuring safety net or employment security when this economy starts to play a major role in the economy. Whatever the consequences may be, these sharing principles that she believes on making sharing economy a success are: that it is social, safe, sustainable, data-sharing and inclusive.

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