How can cities use the sharing economy to solve urban problems?

OCT 31, 2016 By Peter Baeck and David Altabev

Technology is creating a new “sharing” or “collaborative” economy. Sites like AirBnB and TaskRabbit, and the ever-increasing number of crowdfunding platforms, are changing sector after sector of the economy. Up till now, little attention has been paid to how these platforms can help to address environmental and social challenges. Yet, there are a range of ways in which the collaborative economy can help solve city challenges in particular – from reducing isolation to harnessing digital democracy platforms or involving citizens in spending decisions.
 

Pioneering cities like Amsterdam, Paris and Seoul, for example, have already driving through dedicated strategies for the collaborative economy. In embracing the principles that underpin the sharing economy and using their capabilities for urban challenges they are , in turn, building their reputations as “sharing cities”.

Sharing cities are not distinct from “smart” and “sustainable” cities: in fact, they clearly overlap with them. The main distinction is that sharing cities are currently self-identifying, sometimes with express political leadership.

For example, take Seoul, where Share Hub supports the city – led by mayor Park Won Soon – in its “Seoul Metropolitan Government Act for Promoting Sharing”. Amsterdam, on the other hand, which has been named the first “Sharing City” of Europe, was kick-started when grass-roots activity coalesced to form a movement. In this case the movement was initiated by shareNL, a knowledge and network platform for the sharing economy.

Lessons learned

For London or any UK city to do the same, it should begin with being clear on what type of relationship it wants to create between services delivered by the city and the collaborative platforms. At its simplest, this relationship can take two forms:

• Citizen-to-city approaches that focus on integrating collaborative economy activities into how the city operates core activities, such as budgeting and planning; or
• Citizen-to-citizen initiatives that focus on supporting platforms that enable citizens to help each other and improve life in the city, but are not integrated with city services.

Having an explicit and published vision of how the city will support the sharing economy, alongside a set of indicators to plot success, is a basic starting point. Ensuring regulation is up-to-date, flexible and can accommodate ad hoc disruptive business models is also a significant step to enabling a sharing city – demonstrating how the city welcomes new market entrants. And a city can only meaningfully support the acceleration of innovation in the sharing economy – and indeed other sectors – if it can provide leadership and coordination across city hall.

Building a public story about the positive value that can be created through the use of digital tools and technologies has been a key starting point for some cities. And there’s no doubt that for city leaders, political ownership of the sharing economy agenda is a key driver, when well supported by practical and policy interventions.

Efforts in Paris is a good example of this. In 2014, the city sought to open up its budgeting process through the “Madame Mayor I Have an Idea” initiative. The city has, overall, committed to opening up 5 per cent of the city’s investment budget (from a total of €426m, over the course of the current mayoral term) to ideas and votes by citizens.

Rolled out in two stages, the first version saw fifteen proposals put forward by the Paris City Council and some 40,000 votes cast. The next year, once a new dedicated website was launched, Parisians suggested over 5,000 ideas and more than 58,000 people voted – building public awareness and putting the infrastructure in place has been pivotal.

Collaborative economy platforms can also help mobilise people's knowledge, everyday possessions and time to make communities healthier and more connected. As part of its Sharing City agenda, Seoul has initiated projects that tap into dormant assets across the city, ranging from housing to hammers. Take, for example, its “Tool Kit Centres” which offer communities a shared space stocked with items such as tools and suitcases for residents to borrow. Importantly, Seoul has also opened up over 800 city-owned spaces for creative and productive purposes: new ventures need lots of things to flourish, with space to work and grow being key. 

Ultimately, there are many ways that collaborative economy platforms could be used to tackle the needs of people, families, communities and local governments. Closer to home, projects already underway in the UK that tap into the use of collaborative platforms for social good include the likes of Casserole Club and Shareyourmeal, which are being used to address loneliness and isolation, often amongst the elderly.

But for initiatives like these to scale in urban environments, city hall leaders and government policy-makers must be out in front. One positive step in this regard could be to convene important sectors of the collaborative economy – transport, space, time, goods and food – in an industry body or representative structure (or informal sectoral champions). Not only could such a group highlight barriers to policy-makers, the insurance industry and regulators alike; it could also generate awareness of the potential social value collaborative economy platforms could have for our cities.

Peter Baeck is head of collaborative economy research, and David Altabev a senior programme manager, at Nesta.

On 1 November 2016, Nesta will be hosting ShareLab, a one-day event bringing together over 200 policymakers, entrepreneurs, innovators and researchers to better understand how public services, civil society and the private sector can engage with, develop and harness collaborative platforms for good.