Opportunities and Challenges of Sustainable Sharing in the Accommodation Sector

Bachelor Thesis , 2022 , 62 Pages , Grade: 1,3

Business economics - Business Management, Corporate Governance

The purpose of this paper was to examine the long-term viability of three different accommodation sharing platforms (Airbnb, Fairbnb, and Couchsurfing) by evaluating the literature and other source materials available. These platforms' potential and challenges have been highlighted, as well as how each of these platforms contributes to various elements of sustainability. The results indicate that these platforms play different roles in various elements of sustainability. These platforms reduce overproduction and consumption by utilizing spare bedrooms and reducing the need for new hotel constructions. They also make travel more affordable, provide income opportunities (Airbnb & Fairbnb), and promote social interactions. However, they do have certain drawbacks as well. Low-cost travel may encourage people to travel more, resulting in higher CO2 emissions, which may have more negative than positive consequences. However, as shown by the effects of several regulations adopted by different cities, such adverse impacts can be minimized with strict government regulations. Nonetheless, while effective and suitable regulation might help to mitigate the negative effects of these platforms, it is difficult to estimate their exact sustainability repercussions. As a result, this paper calls for a more open examination of accommodation sharing services.

Table of Contents

Abstract

List of Tables

1. Introduction

2. Sharing Economy: Overview
2.1 Development of Sharing Economy
2.2 Economic Perspective on the Sharing Economy
2.3 Social Perspective on the Sharing Economy
2.4 Ecological Perspective on the Sharing Economy

3 Sharing in Housing Sector
3.1 Development of Sharing Concept in Housing
3.2 Example 1: Airbnb
3.2.1 The Rise and Growth of Airbnb
3.2.2 Business Model
3.3 Example 2: Fairbnb
3.3.1 The Rise and Growth of Fairbnb
3.3.2 Business Model
3.4 Example 3: Couchsurfing
3.4.1 The Rise and Growth of Couchsurfing
3.4.2 Business Model
3.5 Opportunities and Challenges of Accommodation Sharing Platforms

4 Sustainability in Accommodation Sharing
4.1 The Concept of Sustainability
4.1.1 The Economic Perspective
4.1.2 The Social Perspective
4.1.3 The Ecological Perspective
4.2 How Sustainable are Accommodation Sharing Platforms?
4.2.1 Airbnb
4.2.2 Fairbnb
4.2.3 Couchsurfing

5 Recommendations

6 Conclusion

References

Abstract

In recent years, the sharing economy has been a hot subject in political and social circles. It has gotten a huge attention because of its importance in the social, economic, and environmental realms. Similarly, the sustainability of the sharing economy has been thoroughly explored on a meta level, with numerous scholars citing it as one of the many reasons to engage in the sharing economy. As a result, the sharing economy has been hailed as part of a bigger sustainability movement that might reduce production volumes while also reducing the negative environmental effects of manufacturing and end- of-life product management. The sharing economy occurs in a variety of industries, but this article focuses on the accommodation sector. The purpose of this article was to examine the long-term viability of three different accommodation sharing platforms (Airbnb, Fairbnb, and Couchsurfing) by evaluating the literature and other source materials available. These platforms' potential and challenges have been highlighted, as well as how each of these platforms contributes to various elements of sustainability. The results indicate that these platforms play different roles in various elements of sustainability. These platforms reduce overproduction and consumption by utilizing spare bedrooms and reducing the need for new hotel constructions. They also make travel more affordable, provide income opportunities (Airbnb & Fairbnb), and promote social interactions. However, they do have certain drawbacks as well. Low-cost travel may encourage people to travel more, resulting in higher CO2 emissions, which may have more negative than positive consequences. However, as shown by the effects of several regulations adopted by different cities, such adverse impacts can be minimized with strict government regulations. Nonetheless, while effective and suitable regulation might help to mitigate the negative effects of these platforms, it is difficult to estimate their exact sustainability repercussions. As a result, this paper calls for a more open examination of accommodation sharing services.

Keywords: Sharing Economy, Accommodation Sharing, Sustainability, Airbnb, Fairbnb, Couchsurfing

List of Figures

Figure 1:Theoretical Overview of Sharing Economy

Figure 2: Relationship Between Actors Involved in a Private Short-term Accommodation Rental Transaction

Figure 3: Business Structure of Fairbnb

Figure 4: Components of Sustainability

List of Tables

Table 1: Comparison of Opportunities and Challenges of Airbnb, Fairbnb and Couchsurfing

Table 2: A Summary of Regulatory Reactions to P2P Accommodation Networks

1. Introduction

Development of sustainable infrastructure and efficient resource utilization are becoming increasingly important global concerns, particularly in light of a significant increase in natural resource exploitation, which is resulting in considerable environmental concerns and climate change around the world. Due to the fact that economic development is strongly dependent on the environment, typical business operations that are conducted in response to market demands may have an influence on natural resource utilization and cause disruptions to environmental systems. As a result of environmental deterioration, resource costs rise, impeding economic growth while also damaging the environment and the ecosystem. Taking that into account, the development of new inventive approaches supported by Information and Communication Technology (ICT) has become increasingly important, as has the decoupling of natural resource consumption from economic growth, which has the potential to transform the prevalent unsustainable use of resources. As a consequence, by recycling materials and reducing energy resource inputs, it is possible to increase economic value. With technological advancements, digital platforms are enabling more efficient, less expensive, and more innovative means of doing business and commerce. It is an excellent example of such a technical innovation to see how the sharing economy, which encourages people to share existing unused resources, has taken off. The sharing economy promotes sustainable development and resource efficiency by encouraging the development of innovative business models that allow for the creative use of available resources (Dabbous and Tarhini, 2021). The sharing economy is one of the most frequently discussed topics in recent studies and researches. It has become a topic of debate in political and social circles in recent years. As a result of its significance in the social, economic, and environmental spheres, it has attracted a great deal of attention. Consumption patterns have changed over the past decades, and this has been reflected in the marketplace leading to the emergence of new companies, in response to the constantly changing consumer behavior. Airbnb, Couchsurfing, Uber, and other similar businesses are examples of such companies. These companies have played a significant role in the adoption and expansion of the concept of the sharing economy in recent years (PwC, 2015). Historically, people have shared physical resources, and the notion of sharing has been present for an exceedingly lengthy period of time. However, the sharing economy, is a recent concept. Despite the fact that it has only recently been established, its growth has been fueled by a number of factors. These include the recent economic downturn, which has prompted people to seek out lower-cost goods and services, a growing need for community engagement in an increasingly disconnected world, an increased awareness of environmental issues, and technological advancements, which have linked sharing partners who do not personally know one another. As a result of technology improvements, the sharing economy has seen a significant increase in its popularity, as has the lowering of transaction costs. The “traditional” sharing is distinguished from the current sharing economy by the use of Information and Communication Technologies (Zvolska, 2015; Cetin, 2020).

The sharing economy notion is believed to alleviate the concerns of the United Nations agenda, such as unequal income distribution and unsustainable consumption, by allowing low-income individuals of the society to earn extra cash or even make a career by sharing their houses, automobiles, and other underused resources available through online platforms. People who share their belongings, according to advocates of the sharing economy, contribute to prevent unsustainable consumption and that sharing improves the economy, the environment, and society as a whole (Zvolska, 2015). The concept of sharing economy operates in different areas. Generally, there are five main sharing economy sectors; accommodation, transportation, buying or selling of goods, on-demand professional services and sharing or renting of goods (Feil, 2015; MasterCard, 2016). However, in this paper, we focus on the accommodation sector specifically. Accommodation is the largest and, probably, most significant sub-sector of the travel industry. Together with the transportation business, the accommodation sector caters for international, national, regional, and local travelers. In certain ways, it fits the demands of almost all tourism market segments. The fast transformation in this tourist sector not only introduces severe rivalry, but also new goods and service requirements(Dutt, n.d.).

P2P accommodation sharing platforms have shaken up the traditional lodging industry, substantially expanding the range of possibilities accessible to individuals all over the world (Dolnicar, 2017). People traveling to other locations want a place to stay, rest, and sleep, which makes the accommodation sector so important to the travel industry. Accommodation sharing became a relatively new alternative for travelers around the world. Airbnb is one of the most popular platforms providing such shared accommodations. Airbnb users may post extra rooms and rent them out to travelers on a short-term basis on the company's platform. These might be separate, private rooms or shared rooms with other visitors who are using the facilities at the same time (Revfine, 2022). In general, accommodation platforms provide services for one of two reasons: either for profit or for free. The sharing economy in the accommodation sector includes more than just online platforms that provide private accommodation for a fee, such as Airbnb, 9flats, Wimdu, and most recently Fairbnb. Furthermore, this covers other alternatives that provide living space which can be used for free. Couchsurfing¹is, among others, one of those platforms offering free accommodations for travelers (BMWi, 2018). Members are able to share their culture and obtain intercultural experiences through participating in sharing platforms, which develops “social capital,” perceived economic benefit, diversity and experience seeking, image and direction, and environmentalism are all elements that are relevant to house sharing platforms (Zvolska, 2015).

The sustainability of the sharing economy has been extensively researched on a meta level, and many scholars have mentioned it as one of the many reasons to participate in the sharing economy (Buosi, 2021). Thus, sharing economy has been lauded as part of a larger sustainability shift that might cut production volumes, lessening the negative environmental consequences associated with manufacturing and end-of-life product management. However, according to findings of previous researches on social, economic, and environmental impacts of sharing economy, it does not always contribute to sustainability, and it has even been accused of perpetuating the existing unsustainable economic paradigm (Enochsson et al., 2021). Airbnb, one of the well-known accommodation providers is subjected to many controversies after questions have been raised about its sustainability and overall impacts on the local residents. Airbnb has been associated with problems like overtourism and gentrification (Such- Devesa et al.021). Detrimental economic effects on the local communities were also identified as consequences of Airbnb (Midgett et al., 2017). As opposed to that, Airbnb has positive impacts, like operational and flexibility benefits, distribution benefits, and destination-based benefits which have been illustrated in a recent study by Pforr et al (2021). A number of other academics have also demonstrated the sustainability framework, in the case of Airbnb. They presented experimental evidence demonstrating that a rise in short-term rentals via Airbnb might have both positive and negative implications. Hence, regulation provisions are required to balance such repercussions (Zervas et al., 2017; Fisshaye, 2019; Sheppard and Udell, 2016).

The purpose of this article is to examine the concept of sustainability in relation to three accommodation sharing platforms (Airbnb, Fairbnb, and CouchSurfing), with the research question, "What are ways to increase the sustainability of accommodation sharing?" To address this question, a large body of material from a variety of sources will be analyzed extensively, with an emphasis on the influence of these platforms on various aspects of sustainability (economic, social, and environmental). The paper is structured as follows: Following the introduction, the second chapter provides an overview of the sharing economy, followed by the third chapter's discussion of sharing in the accommodation sector. Throughout this chapter, you will see examples of the three main platforms' growth, development, and business strategies. The fourth chapter focuses on the linkage between Short Term Rentals (STR) and sustainability, illustrating how the target platforms contribute to the development of a more sustainable economy, society, and environment. It will be proposed recommendations in the fifth chapter, just prior to the final chapter's conclusion.

2. Sharing Economy: Overview

The sharing economy is a new economic sector born by modern digital technology. However, the notion of sharing products rather than owning them is not new, as is widely known. Libraries and cooperative property are two long-standing examples in ancient eras. The significance of digital technology is particularly novel in the sharing economy. A web-based platform that mediates transactions, or the use of an app to execute such transactions, is typical of sharing economy businesses. The use of the digital platforms allows for a significant growth in the number of transactions in the sharing sector (BMWi, 2018). The growing population, urbanization, rising concerns about scarce resources, a sluggish economy, and the development of social technologies have all contributed to the advancement of a sharing economy that places a premium on access rather than ownership. The Internet of Things (IoT) has provided consumers with new opportunities to communicate with one another and to use the underutilized capacity of things they possess or services they may provide. As a result of this interconnection, consumers may more easily fulfill a number of objectives while also possibly saving or earning money on commodities and services that might otherwise go unused or under-exploited (American Library Association, 2014).

Easy-to-use platforms can now be established thanks to technological advancements, allowing a growing number of individuals to access them virtually regardless of their location. The resultant digital markets are at the heart of the majority of sharing economy activities. Many of today's sharing economy platforms profit from the new technological capabilities (Stokar et al., 2018). Underpinning the sharing economy business model is the emergence and exponential growth in the use of digital platforms and devices. While people have always engaged in access-oriented economic activities (e.g., renting, bartering), recent technological advances have made it possible for on- demand transactions to occur through an online platform, be accurately timed and thus more scalable, and dynamically match supply and demand. Rapid adoption has helped to dramatically reduce the transaction costs of commerce thanks to technological advances (PwC, 2015).

According to Karobliene and Pilinkiene (2021), sharing economy is built on three fundamental pillars: access economy, platform economy, and community-based economy, in which underused assets are shared among members of a community. As a result, the primary participants in the sharing economy are the suppliers of the shared commodities, the users or consumers, and the information technology platforms that facilitate the exchange of information. The diagram below (Figure 1) depicts a theoretical overview of the sharing economy - the interaction between suppliers of shared products and consumers that is mediated by information technology platforms, promoting access to items rather than ownership - in terms of its theoretical basis. The access-based economy, in many ways, exemplifies the effort of sharing unused resources in order to promote their efficient use, ultimately leading to the optimization of resources. The platform-based economy rightly asserts that the sharing economy's actions are supported by digital solutions, in which suppliers and users collaborate to produce anticipated value depending on the demands of the involved party. An end result is that a full and safe transaction system is established, resulting in the players of sharing economy business model benefitting from economic, social, and environmental values. Lastly, the community-based economy represents activities that are managed by non-contractual, non-hierarchical, and non-monetized types of interaction. Researchers have found that the key goals are the formation of solidary communities, the accomplishment of social missions, and the pursuit of shared goals, rather than the generation of economic profit.

Abbildung in dieser Leseprobe nicht enthalten

Source: Karobliene and Pilinkiene (2021, 3)

When something can be rented for a fraction of the cost from an unknown third party, how can it be considered ethical to pay exorbitant prices for it? Based on this idea, an increasing number of internet platforms that allow individuals to share cars, apartments, bicycles, home appliances, and other objects have sprung up in recent years. It is possible to connect with those who are willing to pay for the use of your property via these online services, allowing people who would not have otherwise access to your assets (The Economist, 2013).

Research by the European Commission has found that about 740 million of the roughly 1 billion cars on the world's roads today are used by just one person, and that the average household owns $3,000 worth of assets, most of which sit unused in the driveway. Using the sharing economy could be a rational economic decision from two points of view: first, users do not have to invest in an expensive asset, and second, providers can use their unused assets to generate additional revenue. Ownership imposes a large financial burden, as buying and maintaining the product is a costly affair.However, in the access-driven economy, you only have to pay for what you actually use. Therefore, it is better to use a community-based solution for products that are only needed occasionally. On theother hand, owners of such items can earn extra income by sharing them. Many see the possibilities of the sharing economy as a means to supplement their income, while for others it has become a main source of income. One of the reasons for this is that the individual activities do not require extensive or additional investment in assets or complicated bureaucratic procedures, so the barriers to entry are low and market entry involves relatively low burdens and sacrifices. A rising number of consumers are expecting a type of consumption that involves a high level of human engagement and a sense of community, with items provided by individuals rather than "faceless" corporations. In this approach, business services shift from transactional to experience-driven, with trust as the foundation. On the other hand, the shift in attitudes regarding ownership is strongly tied to the fact that, as globalization deepens, the choice of items and services available grows larger and more diverse; with the rise of online marketplaces, it is now possible to buy almost anything from anywhere in the world. If consumers do not have to commit to a solitary product for the long term, this might be a huge benefit (PwC, 2015).

2.1 Development of Sharing Economy

Sharing or swapping products or services is not a novel concept. In the 18th century, community libraries arose, allowing residents to lend and borrow books from their neighbors (Le Jeune, 2016). However, different scholars have discussed the definition of “sharing.” Curtis and Lehner (2019) defined “sharing” “as an act of division into equal parts; as an act of distribution; as a form of common ownership; as an act of communication; or as a form of individual expression online.” (p. 3).Price (1975) described sharing as an"...allocation of economic goods and services without calculating returns, within an intimate social group, and patterned by the general role structure of that group.” (p. 4). The term "sharing" refers also to providing something to a third party for their use or receivingsomething from a third party for your own use. It is a traditional social practice that has been and continues to be conducted mostly amongst individuals who are familiar with each other, such as family members or friends and acquaintances. With the introduction of the Internet and the growth of digital networks, the sharing behavior has undergone a fundamental transformation, in that it has recently become simpler amongst strangers, and access to the associated networks has become low barrier. This transformative advancement, promoted by modern ICTs, prompts some authors to speak of the term "sharing economy” (Scholl et al., 2015).

The concept of sharing has received a lot of attention in recent talks about digital media and network cultures. Politics, socialism, communism, anarchism, the free culture movement, and the digital commons are all becoming increasingly entwined with sharing. It stands in contrast to everything associated with neoliberal ethics, along with similar values like as openness and collaboration (Wittel, 2011). On the other hand, the term "sharing economy” has yet to be defined definitively. Scholars have different interpretations and definitions of the sharing economy. There are various terms synonymously used for the sharing economy, such as Collaborative Consumption, Peer-to-Peer (P2P) - Economy, Mesh Economy, Gig Economy, Access Economy, and On-Demand Economy (Zhou, 2018; Köbis etal., 2021). The sharing economy concept is well-known across the globe. There is, however, no universally agreed-upon definition. The definitions cover a wide variety of topics, from business model design to motivations for participation (BMWi, 2018). Companies whose business model is built on the web-based brokerage of temporary rights of use for the typically sequential use of commodities, sometimes paired with services, by shifting end users, are part of the sharing economy. This kind of sharing is in contrast to conventional business model, in which goods and services are owned by a single person and subsequently rented to the general public (ibid).

In attempts to define the sharing economy and Co., many scholars produced different definitionsand characterizations. Aloni (2016) referred sharing economy as "an economic activity in which web platforms facilitate peer-to-peer exchanges of diverse types of goods and services.” (p. 1398). Wherry and Woodward (2019) further defined the sharing economy as "a larger set of activities, including goods exchange, labor services, and efforts to build social connection.” (p. 52). Habibi et al. (2017) also described the phrase "sharing economy” as "an umbrella term for a wide range of nonownership forms of consumption activities such as swapping, bartering, trading, renting, sharing, and exchanging.” (p. 113). Similarly, Moos (2020) described the sharing economy as a collective term for companies, business models, and associations that allow a shared use of goods, services, or information (Moos, 2020). Despite discrepancies in definitions, authors see the sharing economy as a catch-all term that embraces a vast range of behaviors and business models that cannot be reduced to a single description (Curtis and Lehner, 2019, 3).

The concept of sharing idle capacity is essential to the definition of the sharing economy since it separates the practice of sharing products from the practice of providing on-demand personal services. Underutilization is also another crucial factor in the current debate concerning house sharing services such as Airbnb, which is now underway. When a home-owner is away on vacation or on business, or when he or she has a spare bedroom, the asset is under-utilized. In other words, a vacant home might be deemed temporary idle capacity for the time being. On the other hand, if a person purchases a second house and rents it out to visitors on a permanent basis, this is considered operating a commercial lodging facility, such as a bed and breakfast or hotel (Frenken and Schor, 2017). According to Proserpio and Tellis (2017), there are a number of driving factors that contribute to the growth and success of the sharing economy. These factors include underutilized resources, advancements in technology, the globalization of local economies, systems for trust and reputation, social contact, and flexibility. The availability of underutilized assets in the economy, as well as the presence of customers who need such assets, is one of the fundamental drivers of the sharing economy. In this case, extensive Internet penetration and technical advancements aided in the expansion and proliferation of the sharing economy. As a result of technological advancements, the global economy has been able to integrate numerous local economies. In the global economy, resources that have been underutilized in the local economy may now be able to find new customers. Apart from that, keeping digital records of prior transactions allows for the development of reputation and trust, which is particularly apparent via the mechanisms of digital evaluations of suppliers and users. However, the intimate and direct relationship between service or product providers and customers is a major feature of many platforms in the sharing economy. As a result, people are more likely to engage in marketplaces that allow for this kind of communication and connection to take place. In the sharing economy, participants have the ability to choose when and how much time they want to spend on these platforms as providers of goods and services. Platforms for sharing can be utilized to generate additional income or to completely replace the regular 9-to-5 jobs, depending on the individual's needs and circumstances (Proserpio and Tellis, 2017).

In a similar vein, Rachel Botsman and Roo Rogers listed technology, cost awareness, environmental concerns, and revival of community spirit as the primary drivers of the sharing economy in their 2011 book “What's Mine Is Yours: The Rise of Collaborative Consumption.” (Trivett, 2014). Furthermore, according to Chiang et al. (2021), the society, the economy, science, and technology have all played a significant role in the promotion of the sharing economy. They have also pointed out that the recent development of the sharing economy has been mainly driven by societal, economic, and technological drivers that have resulted in significant transformations. In the analogue era, information costs were significantly high, thus sharing activities did not scale out and were restricted to tiny, close-knit groups. Information costs have reduced dramatically as a result of the growth of digital technology and the Internet, as have coordination costs for sharing activities. This sparked a surge in internet sharing activities, propelling them from the domain of hobby to largebusiness. Concerns about their influence arose as a result, which were often exacerbated by media headlines emphasizing conflicting elements. P2P sharing activities may compete with more officially organized economic transactions, pose regulatory issues, and have a variety of negative consequences for consumers and service workers (Codagnone and Martens, 2016).

As stated by scientific experts, the over-exploitation of natural resources as a result of excessive human consumption, particularly in more developed countries, is the cause of the extinction of animal species and contributes to the continuing emissions of greenhouse gases. Habitat loss, biodiversity loss, pollution, and climate change are just a few of the negative repercussions of our excessive consumption. As a result, there should be found new ways to replace our unsustainable consumption practices. Product-service systems, access-based consumption, collaborative consumption, and the sharing economy are just a few of the techniques being discussed in academiccircles to dematerialize our economies. The actual implementations and eventual sustainability ramifications of sustainable consumption practices, on the other hand, look gradual in the perspective of our rising sustainability challenges (Curtis and Lehner, 2019). Some authors have stated that the sharing economy is a source of sustainable value creation. This emphasizes the significance of the sharing economy in terms of resource and energy efficiency, which can help achieve and improve the UN SDGs (Karobliene and Pilinkiene, 2021). Increasing human consumption is the main factor behind the tremendous global change we are experiencing, as demand for energy, land, and water has skyrocketed. Consumption measures, such as the Ecological Footprint, show how much resources are used overall. The things we use, the supply chains that support them, the resources they utilize, and how these are harvested and created have a wide range of effects on the environment (WWF, 2018, 6). Consumption patterns linked to the sharing economy are supported by some academic researches and popular media, which assert that these activities have the potential to foster more open, inclusive, and democratic ways of production and consumption. The promise of the sharing economy, on the other hand, is at odds with the practices of sharing platforms, which result in a range of experiences among users and society: inclusiveness versus discrimination, democratization versus social exclusion, flexible employment versus exploitation, social cohesion versus gentrification, to name a few comparisons. In recent years, growing scientific data and user experiences have shown that the operations of sharing platforms such as Airbnb, Uber, and other shared mobility platforms are having detrimental societal consequences. Concerns have been raisedabout the possibility that sharing platforms are only taking advantage of the time and resources of its users to their own deterioration (Curtis et al., 2020).

Ever since it was first proposed, the notion of collaborative consumption has been heavily challenged. However, it has been pointed out that the utopian economic projections outlined cannot be found in all sharing economy offerings. It is often the case at Airbnb and other comparable businesses that are focused on generating profits for their shareholders. A brilliant marketing tactic, according to the critics, is being used in the promotion of the sharing service (Ropret et al., 2019). On the one hand, the sharing platforms are accused of being able to undercut the price of established businesses entirely at the cost of its employees. There is concern about low wages, moonlighting, tax avoidance, and a lack of safety and hygiene requirements, among other things. The fact that private accommodation brokerage is already underway in a number of locations makes this an even more compelling proposition. The sharing economy has a detrimental influence on the housing market, particularly in big cities where there is already a significant demand for affordable housing. This is because the accommodations for tourists displace the rental housings for city inhabitants. Therefore, opponents are calling on the government to implement appropriate rules. The extent to which the environment is really better protected in all cases is likewise up for debate. Also noted is that sharing economy platforms offer a significant danger to privacy, since the information accessible on them, particularly on the part of service providers, may be quite incriminating when it comes to personally identifiable information. Both data submitted by users and information created by other parties are included in this category (ibid). Due to the fact that its basic concept applies to all three components of a sustainable development: economics, the environment, and the society, the sharing economy has a significant impact on city and community sustainability. The significance of these characteristics, as well as how they are fundamentally tied to the sharing economy, will be examined in further depth in the following sections (Akande et al., 2020).

2.2 Economic Perspective on the Sharing Economy

The global sharing economy is expected to bring hundreds of billions of dollars to the economy, andit is rapidly expanding (Köbis et al., 2021, 317). According to Statista (2022) the global sharing economy is expected to grow to 335 billion dollars by 2025, up from only 15 billion dollars in 2014 (see also, Olalla and Crespo, 2019). It is clear from the estimates above that there is a great deal of capacity for the sharing economy to have a major influence on the economic growth of nations. This also emphasizes the necessity for scientific research into the topic (Karobliene and Pilinkiene, 2021). The sharing economy offers both commercial and innovation advantages. There are several diverse ways in which the sharing economy sectors contribute to the overall economy performance. Sharing homes, sharing rides with peers, and utilizing vehicle-sharing platforms are all instances of how they may all benefit the market by increasing competition among providers while also, at the very least, temporarily increasing new car sales. Additionally, participants in the sharing economy and the coworking movement believe that participating in either one or both of these movements will improve the local community by revitalizing diminishing retail and commercial businesses in their respective communities (Köbis etal., 2021).

In economic sense, the term "Sharing Economy "is more contentious. On the one hand, it can refer to the non-commercial exchange of commodities or services, which may contribute to more effective use of existing resources while also making access to certain items easier that they are only borrowed instead of acquiring. This notion of shared usage may be found, for example, in the popular, non- commercially organized Car Sharing. On the other hand, sharing economy is about platform-based business models. This is primarily due to the availability of new digital technologies (Smartphone Apps, mobile Internet). These modern technologies have drastically decreased transaction costs for the brokerage of goods and services, allowing hitherto disorganized marketplaces to flourish (Otto Group, 2017). The sharing economy's direct economic implications are undeniably favorable. In the sharing economy, people will only participate into a transaction if it is advantageous to both sides. Even in the case of products lending, there is a benefit: the lender incurs low expenses because the borrower does not require the product during the lending time, while the borrower has free access to the commodity. Lower transaction costs can be seen as a direct result of increased income or customer welfare. Due to the fact that transaction costs associated with stranger sharing were just too high in the past, millions of transactions are now taking place that would not have happened otherwise (Frenken and Schor, 2017). Prior to the advent of Internet platforms, individuals were already lending or borrowing commodities to one another. They shared with family and friends due to their established and trusted social connections. What is novel now is that consumers are now lending things to strangers, since the internet has significantly reduced the cost of transacting with unknown parties. In economics, transaction costs refer to the expenses associated with searching for and establishing a contract. These were remarkably high among strangers before the introduction of the internet, since there was little information accessible concerning supply, trustworthiness, and contract forms. This is one of the reasons why sharing was traditionally restricted to a small group of friends and family members. As a consequence of the proliferation of internet-based platforms, the expenses of searching for and negotiating a contract have decreased significantly. Therefore, due to the widespread use of standard contracts and online payment methods, consumers may now more easily discover the products and services they need (Frenken and Schor, 2019).

However, from an economic standpoint, the sharing economy practices have also resulted in some negative consequences. Sharing economy companies such as Uber and Airbnb are putting pressure on certain traditional services. Existing services are safeguarded by a regulatory framework that grants limited privileges. As a result, when confronted with competition from the sharing economy, which reduces transaction costs to nearly zero, these services will be forced to adapt, join, or shut down (Brachya and Collins, 2016). Moreover, service providers frequently describe feeling overwhelmed by their workloads, feeling more dependent on more powerful players, feeling a lack of autonomy, and being concerned about getting negative feedback from customers. As a consequence of the sharing economy's generally hazy distinction between work and play, service providers are left vulnerable and unclear about their social protection, which may lead to the creation of unregulated employments (Köbis etal., 2021).

2.3 Social Perspective on the Sharing Economy

One of the most important characteristics of the sharing economy is that it gives people possibilities to establish and sustain social connections. The social components of the sharing economy might also encourage people to participate in the sharing economy. Therefore, sharing economy has widely been attributed with generating social benefits. As previously stated, the development of internet platforms made sharing among strangers more appealing, hence expanding an existing practice to a broader social audience on a more widespread basis. Strangers meet face to face on various platforms after a matching process, and it is believed that new social bonds are formed as a result of these face-to-face contacts. Apart from that, sharing economy activities may not inevitably result in stratification, since owners may be anticipated to have a different socio-demographic background than renters or borrowers. It is possible that, in the case of more costly commodities such as automobiles and residences, the suppliers are wealthier and older than the ordinary renter. Sharing behaviors improve social mixing to the degree that sharing peers also build meaningful relationships as a result of their interactions (Frenken and Schor, 2019).

From a social standpoint, some of the characteristics of the sharing economy include that it helps to personal progress as well as a feeling of belonging in a community. Some of the most significant advantages of participating in the sharing economy include the opportunity to develop personally by meeting, connecting with, and interacting with strangers in a meaningful way. Participating in commercial sharing can, on the other hand, increase the popularity of service providers, assist them in being their real selves, and create a feeling of accomplishment and empowerment in them (Köbis et al., 2021). Users and suppliers alike may find social appeal in sharing economy systems, which is a plus for both. Participants in the sharing economy increase the value of their social networks as a result of their interactions with new people. This kind of social gain is most noticeable when the participants consciously want personal interaction, such as when sharing a room rather than renting a whole apartment or choosing carpooling rather than using a private tax (ibid). In this sense, Airbnb establishes itself as a major brand in the community, focusing on connecting individuals with unique travel experiences through its platform. One of the primary motives for pleasure travel is the desire to interact with the community of the destination. Airbnb promotes the importance of traveling like a local while staying in a home-like setting. Additionally, it fosters the unexpected joy associated with engaging with the host. Apart from the financial component, which plays a critical role in the involvement of sharing economy, the social aspect is however, another crucial factor in maintaining participation. Among the most fundamental aspects of the Airbnb business model is the importance of social connection, which has a significant impact on the consumer experience and satisfaction. The desire for social interactions with the local community and meaningful engagement with the host are the primary reasons why tourists choose P2P accommodation. social connections may serve as a method of increasing the total value of sharing economy businesses that offer lodging for tourists (Sung et al., 2018).

2.4 Ecological Perspective on the Sharing Economy

From an ecological perspective, the sharing economy has a positive effect on the environment since it reduces the total resources needed and helps to minimize pollutants, emissions, and carbon footprints. in the transportation sector, for example, car sharing may reduce the number of kilometers driven, which has a good environmental effect. By moving personal transportation options from ownership to demand-fulfillment, these sharing activities may also encourage long-term changes in consumer behavior. Similarly, bike-sharing systems may reduce the use of automobiles, which often consume oil and generate pollution (Mi and Coffman, 2019). According to the European Commission (2017), the sharing economy's accommodation sector also benefits the environment. As renting a shared flat has less environmental consequences than staying in a midscale or premium hotel. But nevertheless, at a macroeconomic level, lower vacation lodging prices owing to collaborative housing, such as Airbnb, may lead to greater travel, resulting in increased ecological impacts.

[...]

---

¹The term "Couchsurfing" refers here to the organization "Couchsurfing International Inc.", not to the act of supplying people with free couches. It will also be used in place of the lengthy name throughout this paper. Thus, the sources cited in this paper are specific to the platform and not to any type of the activity itself.

• College: University of Applied Sciences Darmstadt (Faculty of Business)
• Grade: 1,3
• Author: Abdiaziz Muhumed Nur (Author)
• Publication Year: 2022
• Pages: 62
• Catalog Number: V1373639
• ISBN (PDF): 9783346911155
• ISBN (Book): 9783346911162
• Language: English
• Tags: Sharing Economy, Accommodation Sharing, Sustainability, Airbnb, Fairbnb, Couchsurfing