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Implications for regulators

Implications for regulators

Overtime as industries and technologies have developed, regulations have had to adapt. This is no different in relationship to the share economy where many countries are being challenged to review laws and regulations in order to accommodate this new economy.

In many cities and countries we have seen that, Uber is either partially or fully banned. In Berlin, Barcelona, Paris, New York, Amsterdam and London, Airbnb is either banned or faces heavy sanction and regulation.

Previously we’ve discussed some of the problems that the sharing economy is posing for regulators, but knee-jerk responses to this disruptive trend will only be a Red Flag law response; a case of fighting the unknown with hostility, instead of adapting existing regulatory frameworks to accommodate the change. The sharing economy is so vast; regulators will fail if they crack the whip instead of bringing in the horses to graze where there is grass.

Perhaps the best way forward for regulators is to work together with the businesses and participants (including their own constituents) to find the best way to provide consumer and worker security in the sharing economy, as well as making them contribute their share to the national wallet. Uber, for instance has been very cooperative with legislators to help provide regulations for ridesharing in the sharing economy. This approach is more beneficial to the millions of people who benefit from the sharing economy.

Of course, it is impossible to find one perfect regulatory cap that fits every participant in the sharing economy. But the spirit of regulation is universal and if it guides regulatory principles, then regulators can work hand-in-hand with the businesses and consumers in the sharing economy to find dynamic and flexible regulations that do not inhibit or fight innovation. The sharing economy has proven that it is not a fluke: it is here to stay, and regulators will require the patience and the tenacity to find a home for it in the laws.


Activity

Read how Victorian taxi drivers protest in Melbourne's CBD over State Government reform plans. (Reading time: 4 minutes)

In this complicated matter, what do you think policy makers should keep in mind when deciding on how to regulate new sharing economies?

Post your thoughts in the Comments section.


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This article is from the free online course:

Business Futures: the Sharing Economy

RMIT University