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Why The 'Sharing Economy' Is Bad For Friendship

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This article is more than 10 years old.

This is a guest post by Michal Tsur,  president and co-founder of Kaltura and Leah Belsky, the company’s  senior vice president of operations.

A friend asks whether she can stay in your New York City apartment during Spring break, when you will be out of town. “Sorry, I rented it out through Airbnb,” you reply.

Conversations like this one have become increasingly common in what we call the “sharing economy.” As we use various online platforms to share and optimize the monetary value of real estate and personal property, an extended population have become our intimates. In 2012, two and a half billion people took part in the sharing economy for room rentals alone.

Yet the term “sharing economy” is something of a misnomer since it bears little relationship to what we have traditionally understood as sharing. In the past we might have been happy to accommodate the friend who visits our hometown during Spring break. But in an age when one can easily rent out the bedroom, we might be giving up income by doing this good deed. We’re now charging for privileges previously reserved for friends.

This mindset and reevaluation of such a favor could easily spill over to other contexts, like allowing a friend borrow a car, use extra tickets, or get free childcare. Prior to the emergence of the sharing economy, we didn’t know how to monetize these items and we were less aware of the opportunity cost of giving them away.

Will our friendships suffer if we no longer share our valuable personal assets and provide favors?  There are several conceivable outcomes.

One possibility is that, as new platforms emerge allowing individuals to purchase what were formerly expensive assets at a cheap price, the need for this category of favors might diminish. For example, if I can easily rent a car for an hour or get a cheap apartment for a night, I might have less of a need to rely on friends when I travel to a new city.

Another possibility is that the domain for “favors” will shift. In the future, it might seem less appropriate for us to expect others to provide free rooms, transport, or services. Instead, more personal or customized services – friendly advice, counseling, a special home-cooked meal, or companionship to the theater – will become the currency of friendship.

Alternatively, the sharing economy could strengthen friendships by eliminating the sense of indebtedness. Friends could crash at your place every now and then, but then instantly repay the favor by giving you cash or lending you an asset of equivalent value.

A bleaker scenario might unfold with friends in need. Favors have been an important social safety net for people going through rough times. It’s possible that, as the opportunity cost of favors becomes higher, those in need will hesitate to ask for favors -- and those with assets to share will become less generous.

The sharing economy is just beginning. It gives some of us the tools to earn extra money. Others will feel a deficit as it disrupts the way we view good deeds and redefines what it means to be a kind neighbor and friend.

What do you think about the shift toward the sharing economy? Please join the conversation in the comment space below.