The best way to preserve the sharing economy is not to intervene

Throughout the pandemic, the sharing economy has proved to be one of the most resilient models of human interaction. ...

Food delivery apps played an important role in preserving our sanity during quarantines and lockdowns, and ride hailing apps made it possible for us to see our loved ones when public transport was inaccessible. However, as a result of travel restrictions, some sectors of the sharing economy have suffered severe losses. 

The latest Consumer Choice Center’s Sharing Economy Index examines the impact the pandemic has had on the sharing economy in 50 cities globally. The index’s main goal is to inform consumers about the variety of sharing economy services at hand. To measure global sharing economy friendliness, the index looks at the availability and access to ride-hailing, flat-sharing services, e-scooters, professional car sharing, peer-to-peer car rental, and gym sharing. 

Some governments have sought to use the pandemic as a pretext to further restrictions of consumer choice in the said fields. For example, in June 2020, Amsterdam banned short-term accommodation rentals including Airbnb from operating in the three districts of its historical centre. Fortunately, the ban was overturned in March this year. 

Similarly, in June 2020, Lisbon’s mayor pledged to “get rid of Airbnb” once the coronavirus pandemic is over. However, Airbnb is still available in the city, and hopefully remains so.

According to the findings of the 2021 Sharing Economy Index, The top 10 cities according to the index are Tallinn, Tbilisi, São Paulo, Riga, Vilnius, Warsaw, Kyiv, Mexico City, Oslo, Stockholm.

On the other hand, Minsk, Valletta, Amsterdam, The Hague, Bratislava, Ljubljana, Nicosia, Sofia, Tokyo, Athens, Luxembourg City found themselves at the very bottom of the list.

Eastern Europe continues to have a more liberal attitude towards the sharing economy while Western and Central European countries stick to the restrictive approach. Both Nordic capitals — Stockholm and Oslo — are among the top sharing economy friendly cities in the world. Similarly, their Northern European neighbours — Tallinn, Vilnius, and Riga — also score highest in the Index. 

Tallinn remains the most sharing economy friendly city. lts low level of regulation of ride-hailing and flat-sharing services along with openness to e-scooters and outstanding innovation in the digital space helped take it to the first place. Estonia is well-known for its booming digital state, and the fact there is even a carpooling app for kids reinforces this fact.

Although the 2021 Index’s results weren’t significantly different from the last year’s, and Eastern and Northern European cities seem to lead the way on peer-to-peer exchange, there are signs that this might soon change, too. As the sharing economy services gain popularity, the temptation to overregulate them grows exponentially. Ukraine’s capital Kyiv, for example, might soon become the next European city to ban e-scooters from sidewalks. 

Europe needs to approach the regulation of the sharing economy in a smart way, and that implies putting consumers, and their needs, first. Excessive taxation and bureaucracy in the form of various permits do more harm than good and make consumers foot the bill. As we are recovering from the pandemic, we need to encourage Europeans to effectively exchange their assets with each other and to make the most out of them. The best way to do that is not to get out of the way.