Economics and Design of Sharing Platforms

Consumers increasingly favor sharing instead of owning products. Granting these consumers temporary ac- cess to underutilized products is the basic idea of the recently emerged sharing economy, which is expected to grow up to $335 billion of revenues in 2025. The Time Magazine considers sharing instead of owning products as one of the ten most important ideas that will change our world. Some economists predict that our established capitalistic system is passing and the sharing economy is rising in its wake that will transform our way of life. We are already witnessing the emergence of a hybrid economy where the two economic systems often work in tandem (i.e., companies from automotive industry traditionally sell their cars and at the same time share their cars via sharing platforms such as car2go) and sometimes compete (i.e., Airbnb competes with the hotel industry on shares in the accommodation market). This trend is driven by sharing platforms such as AirBnB or Uber. The innovative character of these platforms is that they use electronic market sys- tems based on the mobile Internet to match lenders and borrowers and consequently increase trade and al- locative efficiency. To prove the predictions mentioned above, researchers have to shed more light on the economic effects of sharing platforms. The main goal of this research project called Economics and Design of Sharing Platforms (EDeShare) is to examine the economic effects of sharing platforms on the participants in the sharing ecosystem and the so- ciety as a whole. We further aim to analyze different design options such as different trust features to be im- plemented in sharing platforms, pricing models for sharing platforms, and policy measures for regulating the sharing ecosystem. Finally, we aim to prototypically implement sharing platforms to empirically test the theoretical findings in experimental studies. Methodically, we primarily use analytical modeling, but also qualitative content analyses to validate our model assumptions and experimental data analyses to empirically test our findings. As a result of this research project, we aim to provide a tested theory that will inform sharing platforms on how to design and price their mediating services and policy makers in preparing a legal framework to regu- late the sharing ecosystem.

No additional funding sources recorded.