By Jennifer Wheary, World Ark contributor
Illustrations by Maxwell Holyoke-Hirsch
Ask a group of second graders why it is important to share, and they will tell it to you straight:
“Because if you share you get to play with more toys without having to buy them.”
“Because if you don’t share, you’ll be in trouble.”
“Because it means others will share with you.”
“Because it will make someone happy.”
“Because it will make you feel good.”
While these typical second graders are far from armchair economists, they are on to something. It is called the sharing economy, and it is worth an estimated $110 billion a year and rising.
The sharing economy, also known as collaborative consumption, stretches around the world. Many believe this trend can remake the global economy into something more sustainable and equitable. Clearly, something is happening that is changing how millions of us get what we want and need.
Rachel Botsman and Roo Rogers, authors of What’s Mine is Yours, describe collaborative consumption as organized or informal systems of bartering, lending, borrowing, swapping, giving or renting.
Botsman and Rogers break the collaborative economy down into several components. One of them, product service systems, enables companies or collectives to lend goods like cars, bikes, tools or cameras to customers. Product service companies include for-profit entities like Zipcar and the nonprofit City CarShare. They also include bike share efforts operating in 500 cities around the world, peer-to-peer lending websites like NeighborGoods and community-based organizations like the West Philly Tool Library.
Another facet of the sharing economy, redistribution markets, move pre-owned goods from where they are not needed to somewhere they can be used. These goods might be sold, swapped or given away. Examples include online classified website Craigslist, used clothing marketplace thredUp, and The Freecycle Network.
The broadest slice of the sharing economy encompasses what Botsman and Rogers call collaborative lifestyles. Here individuals with similar needs or interests share things like space, time or skills. Collaborative consumers work in shared office spaces, form bicycle repair collectives, organize language skill practice groups, share industrial kitchen spaces and let others garden in their yards in exchange for a fee or a portion of the harvest.
Collaborative consumers are also traveling in style by renting out rooms via companies like Roomarama and Airbnb or letting strangers crash on their couches for free via Couchsurfing.org or Tourboarding.com, a website that allows English speakers to find free accommodations in China in exchange for practicing English with their hosts.
In the financial realm, peers are offering each other interest-bearing loans through online financial communities like Lendingclub. They are also funding innovative startups, social organizations and intriguing projects through sites like Kickstarter, Smallknot or Indiegogo, sometimes for perks and sometimes just for personal satisfaction.
These projects might be large or small, local or global. Court Street Grocers, in Red Hook, Brooklyn, was one of many small businesses that asked for help from caring souls via Smallknot when hurricane Sandy flooded their catering kitchen in October 2012. The business raised $25,000 to rebuild.
In April 2013, actor, writer and director Zach Braff launched a one-month Kickstarter campaign to raise $2 million to fund his film, Wish I Was Here, a follow-up to the 2004 hit Garden State. The campaign collected $1.3 million in the first 24 hours. By the end, 46,520 individuals pledged more than $3.1 million.
Braff told fans on the project’s Kickstarter page, “I was about to sign a typical financing deal in order to get the money to make Wish I Was Here. It would have involved making a lot of sacrifices I think would have ultimately hurt the film. I’ve been a backer for several projects on Kickstarter and thought the concept was fascinating and revolutionary for artists and innovators of all kinds. But I didn’t imagine it could work on larger-scale projects. I was wrong.”
This Bandwagon Can Hold More
Opportunities to participate in the sharing economy are multiplying. In 2001, fewer than 10 cities worldwide had bike-sharing systems. As of April 2013, more than 500 cities in 49 countries were operating bike shares. Bike sharing is relatively recent to the U.S., but as of summer 2013 more than 26 cities offered it. And that number is expected to double within two years.
In its 2013 Global Coworking Census, Deskwanted.com found there were nearly 2,500 shared work spaces operating in 80 countries around the world. That was nearly double the 1,320 available in 2012, and more than 300 percent greater than the 2010 figure (600 coworking spaces). Since launching in 2008 with a handful of accommodations for hire, Airbnb has grown to more than 300,000 listings in 33,000 cities across 192 countries.
Sharing is becoming a larger part of the economy worldwide, mainly because it cuts costs. When you factor in car payments, insurance, maintenance and other expenses, the average car costs $9,000 a year to run. Companies like Zipcar make it possible for consumers to borrow a car only when they need it. Zipcar says its average customer saves nearly $6,000 a year compared to traditional car owners. City CarShare, a nonprofit serving the San Francisco area, estimates that its members saved about $100 million in 2012.
Consumers are applying similar money- saving logic to other expenses, too. In 2011, Neal Gorenflo, co-founder of Shareable.net and editor of the book Share or Die, challenged himself to track the money he was saving by sharing. Gorenflo sold his car and borrowed one only when needed. When he traveled, he avoided hotels and found alternative accommodations through companies like Airbnb. He worked out of a shared office space in San Francisco. He began investing in smaller loans via Lendingclub. And he and his wife began sharing a nanny with two other families. All of this sharing added up. Over the course of the year, Gorenflo and his family saved $17,000.
Sharing is becoming a larger part of the economy worldwide, mainly because it cuts costs. For Gorenflo and others, what starts out as an experiment can easily become a regular practice. Why pay for a dedicated babysitter when you can split childcare costs with other families? Why pay for a hotel on vacation when you can house swap with someone or rent a room from a local more cheaply? Why keep buying new clothes for rapidly growing children when you can trade slightly worn duds in and select the next size up from families in a similar boat? Why not exchange your gardening skills for a cooking class?
The internet lets us share our wants, needs and resources more efficiently and more immediately. Simply put, anyone can now arrange to offer anything to (and receive anything from) anyone, anywhere, at any time.
The environmental benefits of sharing resources more efficiently are compelling.
City Carshare, for example, says that in 2012 its members drove a total of 25 million fewer miles than car owners, used 4.3 million fewer gallons of gasoline and emitted 85 million fewer pounds of CO2 into the atmosphere. Freecycle estimates that its 9 million members are keeping 500 tons of usable items out of landfills each day.
The Kids Said It Best
Beyond being kinder to the planet, there is also evidence that sharing is a way to be kinder to ourselves. Research shows that humans are cooperative, rather than competitive beings, and that we feel better and are happier when we share.
When Neal Gorenflo talks about his own decision to live more collaboratively, he explains that he was burned out, tired and isolated. Once he started sharing, he felt more energized. “When I realized I could get much of what I needed from my community, I felt freer and also more relaxed and confident because I had a community behind me.”
Gorenflo is not an isolated case. Golnaz Tabibnia and Matthew Lieberman, researchers at the University of California, Los Angeles, have studied the neurological impact of how we gain material rewards. In reviewing many research studies and conducting experiments of their own, Tabibnia and Lieberman have found that the social context in which we gain material goods matters a lot to our mental state.
Research shows that humans are cooperative, rather than competitive beings, and that we feel better and are happier when we share. The research overwhelmingly suggests that those who gain material goods through collaboration and interaction with others feel more positive emotions. On the flip side, studies show that when individuals feel they have received something through unfair means, they experience negative emotions. In such studies, participants might be asked to divide money with other study subjects in a particular way. Researchers consistently find that fair offers, such as receiving $5 out of $10, create positive emotions. Unfair offers, such as receiving $8 out of $10, create negative emotions, even when a participant benefits from the unfairness.
Research subjects report these negative or positive emotions in surveys, but scientists can also see the effects of sharing and collaboration using MRIs. Tabibnia and Lieberman find that when study subjects acquire rewards through collaboration, social interaction, and by what the participants perceive as “fair means,” MRIs show increased neuronal activity in regions of the brain associated with positive emotions and satisfaction.
There is also evidence that collaboration is more hardwired into our genes than competition. Charles Darwin’s concept of “survival of the fittest” was less about overwhelming strength and more about the benefits of cooperation and compassion. Darwin noted that animal communities raising offspring together were more likely to survive than those who were isolated and driven by aggression and combat. In his books about humans, Darwin wrote that the social instinct to care for one another runs much more strongly in us than any other.
Though sharing may be a natural part of us, how we share is not the same for everyone. The sharing economy takes different forms depending on your community. Culture, lifestyle and individual needs all influence who shares what, and how.
Car and bike sharing services, for example, have a greater role to play in densely populated areas than in rural or suburban settings, where carpooling might be more the norm.
But sharing space, time, smarts, tools and other goods are universal and can happen anywhere. As a group of wise second graders explained, sharing can help us get more while owning less. It can also keep us out of environmental trouble by cutting down our consumption. And it can make us feel happier and healthier. For millions around the world, those three motivations are making it worthwhile to give sharing a shot.