Sharing Morning Future
Guiding Interview 30 April Apr 2018 0830 30 April 2018

Sdogati: «The sharing economy? Is really sharing or is it economy of poverty"

The professor of Industrial Economics at Milan Polytechnic clarifies the matter: "The point is to understand whether consumption figures are changing or the demand is shrinking. In the second case, countermeasures must be taken"

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Access to resources without the constraints of possession is what is offered by the broad range of activities we summarily label as Sharing or Peer2Peer economy. Acquisition is replaced by utilisation, possession is replaced by access. And "Sharing Economy: from possession to access" is precisely the title of the second of the Digital Innovation talks sponsored by the Observers Digital Innovation of the School of management of Milan Polytechnic, held in the month of March, that attempted to take a deeper look at the socio-economic impact of this new business model.

Some thought on the matter is necessary because in the last ten years or so, roughly from the period of crisis, the Sharing Economy (or Access Economy as some prefer to call it) has grown a little everywhere. The debate does not revolve around the number of companies sharing (still only a few) or the impact on the GDP, for now very modest, but the way in which this type of business is interpreted and presented, an alternative mode of consumption. Even a new model of capitalism.

Arun Sundararajan of New York University speaks for example of crowd-based capitalism, to indicate a phenomenon of progressive distribution of entrepreneurial activity through the population. But not everyone shares his confidence and his enthusiasm. During the conference, Fabio Sdogati, professor of international economics at Milan Polytechnic , has put the emphasis on the preponderant role that the economic crisis has had in generating this type of economy.

"The point - Sdogati notes - is to understand if we are facing a change in consumer needs and habits, especially in young people, or if the dominant role is the drop in present and future revenues". The data of the survey presented during the meeting seem to support his point of view. Forty percent of start-ups in fact work with tangible assets (vehicles, accommodation…) that for the traditional purchase would require a capital hardly within reach of a millennial. Intangible assets instead include know-how, i.e. the skills offered on-demand to businesses, followed by delivery and transport services. In practice they are solutions to carve out an income without being directly employed and outside traditional businesses.

The point is to understand if we are facing a change in consumer needs and habits, especially in young people, or if the dominant role is the drop in ​present and future revenues.

Fabio Sdogati, professor of international economics at Milan Polytechnic

Taking up the themes of the conference, we took a closer look together with Fabio Sdogati at the socio-economic consequences of sharing, starting from the question of terminology.

The starting point of his thoughts is concerned entirely with the unmasking of an erroneous name. The word sharing evokes a relationship of equality between the parties but this in fact almost never exists because the alleged sharing is mediated by the market.
Giving it this name was misleading. The research results presented during the conference demonstrated that these realities are of various types and the sharing component can have a greater or lesser presence. For me the component of equality and giving however is indispensable if we want to talk about the economy of sharing, otherwise it is something else. More specifically, it is a kind of business that does not produce, but puts supply and demand in touch via platforms We might call it, to be more honest, the "economy of platforms."

An expression that would include also the gig economy with which the sharing is often placed in the relationship. We can say that while one is substantially a revival of the concept of "rental", the other resumes the old art of fending for yourself except that it is widespread, given some dignity and organised via platforms?
I agree completely. In this regard I quote often Bruce Springsteen, the song Jack of all trades[here are some verses: "I'll hammer the nails, I'll set the stone, I'll harvest your crops, when they're ripe and grown, I'll pull that engine apart, and patch’er up 'til she's running right, I'm a jack of all trades, we'll be all right; we will"]. This is essentially: an economy of poverty. Even when it concerns the qualified job, such as programmers who work by hours via platforms. It is not an economy that produces but is limited to transferring money.

The word sharing has a strong emotional connotation and this type of business is often associated with a rediscovery of sociability, an experiential value that transcends the monetary value. Is this the reason for its success?
The main reason is the saving. We are dealing with operations for profit. It would be different if the youth of a condominium agreed to take turns doing the shopping for other tenants, perhaps the elderly. Or the car pooling practice of commuters in the U.S. in the nineteen seventies during the oil crisis. Certainly, they shared the cost of petrol, but it was not a market practice and the operation was not industrialised.

Let us return to the connection with the crisis of 2008...
The economy of the countries with a high per capita income suffers from a shortage of demand, due partly to the ageing of the population (elderly people tend to save). In the past, the policies prepared by governments were for expansion of the demand. Since 2008 however the obsession with balancing the budget has taken over and public spending has become an anathema. In reality the saving is a private virtue, but a public disaster.

Is there an excess of supply therefore?
An excess of real estate, production capacity, of workers. Counterbalanced by the lack of good jobs. Consequently, who has the properties "rents” them and replaces the earnings from a job with an income that produces nothing and does not create growth: an economy of poverty.

What would be a solution?
Stimulating demand; but governments are not interested and individuals find their own solutions. The job becomes a gig, insecure and without safeguards. I doubt that these solutions can be anticipations of a new world, based on a more efficient way of using what already exists.

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