Editors note on our East Asia series:
East Asia is the most densely populated region on the planet. With that comes growing economic clout but also significant development challenges. Successful achievement of sustainability goals in East Asia will impact more lives than action in the rest of the world combined. Because of this the actions of this region are important not only as examples for the rest of the world but also as the largest scale sustainable development actions in the world. This series will focus on all of the sustainability challenges and opportunities in this area of the world that is rapidly becoming the most important locus of sustainable development.
The global ‘sharing economy’ is estimated to be worth $15 billion. That’s a huge valuation for a sector of the economy that effectively did not exist five years ago. That rapid growth is expected to continue, hitting $335 billion by 2025, but it brings a whole host of challenges that have yet to be sorted out, including how businesses treat “employees” and how you insure sharing.
Despite those challenges, the expansion of the sharing economy can be beneficial in a number of ways. One of these benefits, from a sustainability perspective, is the behavioral change that is associated with sharing, namely, a reduction in individual consumption, and the associated carbon emissions, and an overall improvement in economic efficiency. Sharing goods – whether you share tools or the empty room in your house – when you’re not using them means that everyone consumes a just a little less to achieve the same standard of living. It also reduces the cost of that standard of living, which is the definition of increasing economic efficiency.
For example, consider home improvement projects; they typically require tools to complete. The vast majority of people will use those tools only once for the planned project and then never again. That means, typically, when home improvement projects came up, one of two things happened. . Either, they purchase an expensive piece of equipment, with some amount of carbon emissions associated with its manufacture, which they use once and then leave to gather dust in the garage. Or they can’t afford to buy the equipment and their project is derailed.
The sharing economy fixes both of these problems by allowing someone who purchased that equipment for their own project to share (either for free or a small fee) that tool with someone else planning a new project. The second person doesn’t have to buy a new tool so they save money (and maybe can do something they wouldn’t have been able to afford otherwise), the planet benefits from reduce emissions, and the “sharer” benefits by recouping some of his initial investment in the tool.
The example here is simplified. There are other cases where the benefits aren’t as clear. For example, car sharing services (like ZipCar) have a similar effect to tool sharing. Instead of buying a car that would spend most of its parked in a driveway, you pay a monthly fee and use a car when you need it. On the one hand that reduces the number of cars purchased, but some have suggested it might replace some (low-carbon) public transit trips with (high carbon) car trips.
In general, more serious treatments and robust examinations of the benefits of sharing find that they are less obvious and smaller than expected but still likely exist. But in order for them to truly materialize, the sharing economy must grow. One place that has made a serious policy commitment to making that happen is Seoul, South Korea.
Seoul’s city government launched Share Hub in 2013 to make it easier for citizens to take advantage of the sharing economy. Share Hub helps connect citizens interested in taking advantage of the sharing economy with businesses that offer sharing services. It also promotes seminars and community projects around the city and country.
One of those companies is Naver, the Korean search giant. In an attempt to promote the development of a community sharing ethic they have launched a series of websites to promote the work of developing artists. Placed in the context of the report on the growth of the sharing economy above (written by PricewaterhouseCoopers) on the growth of the sharing economy, these websites indicate clear growth in the Korean sharing economy. The PWC report suggests that the sharing economy will have been normalized when it begins to reach the arts & media space. Naver’s websites provide a platform for developing artists to share their work, gain exposure and develop their careers. And, despite the notion that sharing media hurts artists, the evidence suggests that that isn’t true. In the case of online music sharing, record companies are hurt, but artist’s incomes don’t seem to be. Instead, the increased exposure can actually help.
More importantly, for the rest of the population it provides a source of artistic content that would not exist otherwise. For example, Naver’s Webtoon site is the largest in the country providing new material in a genre that more than a third of the country reads. As in our example above, sharing this content allows for an improvement in the quality of life of the average citizen, at little cost, and (could) generate an economic return for its creators.
As the sharing economy develops around the world, Seoul and Naver can serve as an example for the rest of the world. As they push the sharing economy into sectors that haven’t been tapped in other cities and countries they open the door for its further development. And as the PWC curve suggests, the more sectors that enter the sharing economy, the faster it will grow. While it won’t come without hiccups, this growth is likely to benefit Koreans and the rest of the world.
Image Credit: Kevin Simpson via Wikimedia Commons
Editor’s Note: In addition to being a leader in the growth of the sharing economy in Korea, Naver is a sponsor of S&S and has provided grants to help fund our fellows program.