ATLANTA – Uber, eBay, Airbnb and other so-called peer-to-peer sharing platforms are causing policymakers to scratch their heads – from the General Assembly to the Federal Reserve, but one academic who studies them says they can be good for consumers and the economy.
Arun Sundararajan, management professor at New York University, has been spreading the message, from congressional testimony to lectures and op-ed columns.
“The question is not whether it’s going to happen but to what extent,” he said Thursday in a speech to the board of the Federal Reserve Bank of Atlanta.
The Fed is curious how to track employment as more people begin working for themselves through these online platforms, and it wants to know if its traditional tactics will continue to work. Sundararajan, by the way, says Fed monetary stimulus, like managing interest rates or the money supply, have less impact than state and local regulations.
For instance, Georgia legislators are trying to decide whether to regulate Uber, Lyft, Sidecar and other ridesharing platforms or to deregulate the taxicabs and limos they compete with. The House passed a deregulation bill last week, but the Senate still must make its choice.
Sundararajan notes that the last recession boosted interest in freelancing and moonlighting at the time when urbanization and online technology was making these platforms available and widely accepted. Exactly how much impact do they have on the economy?
“It’s too early for us to measure,” he said, while noting that Uber has become a $40 billion company operating in 55 countries.
The platforms allow people to monetize personal assets like their car, cellphone or even the roof of their house when it’s leased to solar-power companies. As people become more urbanized, they’re just as willing to do business with strangers as they are with established businesses because they have little of the brand loyalty of prior generations and because these platforms offer consumer protections.
A notable exception is craigslist which has also been associated with numerous robberies, murders and other crimes.
Because users are demanding these platforms incorporate their own consumer safeguards, government regulations are seen as outdated hurdles that halt increased customer service, Sundararajan said.
But Uber policy spokesman Dave Barmore says his company, at least, isn’t calling for a Wild West atmosphere where anything goes.
“We are not anti-regulation. We are for smart regulation that takes into account this is a new technology,” he said in a press release.
Beyond the policy challenges, the sharing economy brings benefits, according to Sundararajan. It allows people to easily add income or replace paychecks lost in economic downturns, and it can serve as a way to help the chronically unemployed join the workforce – with some strategic examples to “seed” their community.
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