instability from demand shocks or potential criminals exploiting the platform are risks that are understated by the companies and are often not fully understood. When there is such a shock or event that adversely affects the supplier, Uber and Airbnb can simply shrug their shoulders and point to the fact that they knew the risks associated to joining the platform but continued regardless. However, we must not forget that we live in an information age and therefore transparency is easier than ever to achieve across internet platforms. Information transparency in the context of Uber and Airbnb translates to greater information regarding not only suppliers but consumers, in terms of their reliability, adherence to health and safety, criminal records, politeness, cleanliness, etc. Uber drivers with criminal background checks, appropriate insurance, etc. would be best positioned to obtain the highest ratings and, consequently, be connected with more consumers. Similarly, Airbnb hosts with fire safety certifications and impeccable health standards would be the highest rated by consumers and this would drive future business, separating them from “riskier” options. By rewarding the most transparent, regulators are creating an incentive to improve the health and safety standard of accommodation or ride, whilst not discouraging people to start using the platform as a means of income in the first place. Slowly but surely, the less health and safety conscious platform users will be phased out alongside the less reliable and more disruptive consumers, eventually distilling it down to the highest standard operators serving the best consumers. This is achieved through the publication of standards as opposed to the imposition. One must factor in the ability of regulatory bodies and agencies to remain objective in the face of increased competition. This problem has been evident in recent court disputes between the tech companies and local governments. An example of this was Transport for London (TFL) putting forward several proposals for private hire companies following immense pressure from Black Cab drivers. The proposals did not only put Uber drivers on a level playing field with competition, but actually increased the safety risk for Londoners; a minimum of 5 minute wait for your Uber before getting in meant leaving people waiting on the side of the road as opposed to getting into their Uber car within the average waiting time of 3 minutes. Similar protectionism can be seen in our case study of Airbnb in New York City where much of the anti-Airbnb legislation is being pushed for by large hotel conglomerates so their industry standards must be applied throughout Airbnb and similar companies. This is where the problem lies with the current regulatory approach to the sharing economy; Regulators and lobbyists fail to see that the current regulatory framework of the incumbent industries simply does not translate to the characteristics of the sharing economy. The sharing economy’s proliferation of “people as businesses” means that it is hard to attribute it to taxes or regulations for either people or businesses as it doesn’t fall under either explicitly. Incumbent industries often accuse Uber and Airbnb of evading their systems of regulation. Though this claim is only true so much as the car evaded the horse tax and saddle laws. Instead of trying to standardise regulation for both the sharing economy model and traditional industry, regulators should seek adapt and form new rules that tailor to the characteristics of these innovative new companies whilst balancing the need for public health and safety and ensuring competitive prices. Whilst it is true lawsuits involving Uber and Airbnb still persist worldwide, we are seeing attempts to liberalise the previously narrow rationale behind regulation; San Francisco recently reversed an outright city wide ban on Uber and several cities including London expressed a desire to establish themselves as the sharing economy capital of the world. Malleable, less intrusive, regulation arguably benefits not just the consumer but the economy as a whole. Competition on quality and price benefits the consumer hugely in terms of welfare and ultimately creates employment and wealth across all income levels. This may be a super-efficient Uber driver or Airbnb host, but, regardless, there is significant scope to earn a good living and redirect spending into the economy. A study by the Grattan Institute found that using
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