What is "sharing economy"

n. (label en economics public policy) A system of economic exchange in which participants interact in a direct and cooperative manner, often with the aid of social media, to produce, market, and consume goods, services, and resources.

Sharing economy is an umbrella term with a range of meanings, often used to describe economic and social activity involving online transactions. Originally growing out of the open-source community to refer to peer-to-peer based sharing of access to goods and services, the term is now sometimes used in a broader sense to describe any sales transactions that are done via online market places, even ones that are business to consumer ( B2C), rather than peer-to-peer. For this reason, the term sharing economy has been criticised as misleading, some arguing that even services that enable peer-to-peer exchange can be primarily profit-driven. However, many commentators assert that the term is still valid as a means of describing a generally more democratized marketplace, even when it's applied to a broader spectrum of services.

Also known as shareconomy, collaborative consumption or peer economy, a common academic definition of the term refers to a hybrid market model (in between owning and gift giving) of peer-to-peer exchange. Such transactions are often facilitated via community-based online services.

The sharing economy can take a variety of forms, including using information technology to provide individuals with information that enables the optimization of resources through the mutualization of excess capacity in goods and services. A common premise is that when information about goods is shared (typically via an online marketplace), the value of those goods may increase for the business, for individuals, for the community and for society in general.

Collaborative consumption as a phenomenon is a class of economic arrangements in which participants mutualize access to products or services, rather than having individual ownership. The phenomenon stems from an increasing consumer desire to be in control of their consumption instead of "passive 'victims' of hyperconsumption." The consumer peer-to-peer rental market is valued at $26bn (£15bn), with new services and platforms emerging frequently.

The collaborative consumption model is used in online marketplaces such as eBay as well as emerging sectors such as social lending, peer-to-peer accommodation, peer-to-peer travel experiences, peer-to-peer task assignments or travel advising, carsharing or commute-bus sharing.

The Harvard Business Review, the Financial Times and many others have argued that "sharing economy" is a misnomer. Harvard Business Review suggested the correct word for the sharing economy in the broad sense of the term is " access economy." The authors say, "When “sharing” is market-mediated — when a company is an intermediary between consumers who don’t know each other — it is no longer sharing at all. Rather, consumers are paying to access someone else’s goods or services."