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How To Make The Sharing Economy More Inclusive

For lower-income Americans, the sharing economy could be a huge life improvement—if only the sharing economy was interested in helping them.

[Illustrations: alexkar08/iStock]

In theory, people who make lower incomes have a lot to gain from the sharing economy. If you can't afford, say, a monthly car payment, then hiring a car from a neighbor is the next best thing, and there are now many ways to do that, like Getaround. Research by N.Y.U. researchers Samuel Fraiberger and Arun Sundararajan last year found that ride-sharing has a "disproportionately positive effect on lower-income consumers" mostly because poorer groups are more likely to switch from owning to renting.

But in the main services like Uber and Lyft have mostly been identified with savvy millennials, and people with money. Pew Research recently found that those earning $100,000-plus are three times more likely to use sharing services than those making less than $30,000.

A new working paper from BSR, a nonprofit that promotes business sustainability, looks at opportunities to expand sharing services beyond the groups that use them most now.

"By removing or reducing barriers such as ownership costs and complex, inflexible distribution networks," the report says, "sharing economy models have incredible potential to enable much greater access to crucial goods and services for people and communities who have often been excluded from or are unable to meet their needs through more traditional models."

At the moment, there's a simple lack of knowledge about sharing services. In Pew's poll, half of respondents making less than $30,000 had never heard of Uber, and only 4% of that group have used Airbnb. BSR calls on service providers to hire people with more diverse backgrounds to overcome "a trust deficit in communities of people who believe that the benefits of the sharing economy are not being shared widely."

It also calls for a "human-centered" approach to product design, from flexible payment plans to greater use of the mobile web and Android to accommodate low-income users. BSR suggests subsidies and in-kind services, like the way Capital BikeShare, in Washington D.C., offers free checking accounts for customers without credit or debit cards. And it says companies can think about new locations for sharing, including schools, community centers, or workplaces, which may appeal to low-income individuals more than home exchanges.

Then sharing companies can make new partnerships with government, like Uber's arrangement with Altamonte Springs, Florida, where the city subsidizes rides to and from transit stops, or how Pinellas County, Florida, subsidizes Uber trips in "transit disadvantaged" areas of that area. Or, they can offer services direct to disadvantaged groups, like how Airbnb’s works with nonprofits to support people who need temporary housing, like medical patients traveling for treatment, or low-income students visiting colleges.

Despite the fluffy-sounding term "sharing economy," sharing companies are often criticized for advantaging themselves and their customers over a wider range of stakeholders, from Uber drivers to TaskRabbit workers. BSR says being more inclusive offers a chance to correct that reputation.

"We have reached a critical point where sharing economy companies seeking to maintain their license to operate and grow will need to work with interested parties to strive for inclusivity," it says.

Read more here.

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