Genuine sharing practices in cities produce social value and have the potential to promote sustainability. As such, this study by Finck and Ranchordás argues that regulators should adopt more flexible approaches to support their growth.
The authors begin by tracing the history of urban sharing and its importance to the social and economic well-being of cities. However, in these still early days of the digital sharing economy, they note the tendency of regulators to either do little to support innovative practices or to restrict them by applying ill-fitting regulations designed for other types of businesses.
Reviewing a number of cases across the U.S. and Europe, the study suggests two flexible regulatory paths forward: one ‘experimental’ and the other ‘collaborative’. The experimental approach, through which cities test temporary measures, would allow local governments to build up understanding of the effects of new platforms, proceed with caution, and the time to develop policies that work. The authors note that this approach could be particularly well-suited to new and controversial phenomena. Meanwhile, a collaborative approach, consisting of negotiated rule-making between city officials and platforms, would help strike a balance between safeguarding the public interest and rules that don’t stifle benefits offered by the sharing economy.