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Benefits and Concerns of the Sharing Economy: Economic Analysis and Policy Implications

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  • Kim, Min Jung

Abstract

This paper economically analyzes the benefits and concerns of the sharing economy and derives policy implications that could help to achieve the expected benefits and respond appropriately to any concerns. Primary benefits anticipated from the sharing economy are the creation of new transactions and promotional and market testing opportunities, and the main concerns include the crowding out of existing transactions as well as transaction and social risks. How these benefits and concerns are being realized in Korea is empirically examined by conducting a survey on participation experiences with the sharing economy. The sharing economy is expected to contribute to the enhancement of social welfare with its wide range of benefits if risk factors can be properly controlled. Accordingly, an institutional framework is needed to support the stable growth of the sharing economy, and the unique characteristics of non-professional, peer-to-peer transactions should be reflected in tandem with regulatory equity between existing and sharing economy suppliers. To do this, transaction-volume-based regulations are recommended. Furthermore, to secure regulatory effectiveness and to alleviate transaction risks, the pertinent obligations must be imposed on sharing platforms.

Suggested Citation

  • Kim, Min Jung, 2019. "Benefits and Concerns of the Sharing Economy: Economic Analysis and Policy Implications," KDI Journal of Economic Policy, Korea Development Institute (KDI), vol. 41(1), pages 15-41.
    • Handle: RePEc:zbw:kdijep:200834
    DOI: 10.23895/kdijep.2019.41.1.15
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    References listed on IDEAS

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    1. Iis P. Tussyadiah, 2015. "An Exploratory Study on Drivers and Deterrents of Collaborative Consumption in Travel," Springer Books, in: Iis Tussyadiah & Alessandro Inversini (ed.), Information and Communication Technologies in Tourism 2015, edition 127, pages 817-830, Springer.
    2. Kim, Min Jung, 2017. "Government Policy for the Stable Growth of the Sharing Economy," KDI Focus 83, Korea Development Institute (KDI).
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    Cited by:

    1. Rong, Ke & Sun, Hui & Li, Dun & Zhou, Di, 2021. "Matching as Service Provision of Sharing Economy Platforms: An Information Processing Perspective," Technological Forecasting and Social Change, Elsevier, vol. 171(C).
    2. Xufeng Liu & Hongmin Chen, 2020. "Sharing Economy: Promote Its Potential to Sustainability by Regulation," Sustainability, MDPI, vol. 12(3), pages 1-13, January.
    3. Rim Krouk & Fernando Almeida, 2021. "Exploring the Impact of COVID-19 in the Sustainability of Airbnb Business Model," Papers 2101.00281, arXiv.org.
    4. Baltova, Stela & Vutsova, Albena, 2021. "Setting the Stage of the Sharing Economy: The Case of Bulgaria," MPRA Paper 110229, University Library of Munich, Germany.

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    More about this item

    Keywords

    Sharing Economy; Peer-to-peer (P2P) Transaction; Non-professional Supplier; Regulatory Equity;
    All these keywords.

    JEL classification:

    • D16 - Microeconomics - - Household Behavior - - - Collaborative Consumption
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • M3 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising

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