Research Talk Power in the Sharing Economy University Witten/Herdecke, May 6th 2017
Page 2 More and more Items of Everyday Life are shared Power in the Sharing Economy through a fast growing Number of Internet Platforms CARS GARDENS AND TOOLS APARTMENTS HOUSEHOLD ELECTRONICS ITEMS AND MEDIA SPORTS GEAR
Power in the Sharing Economy Page 3 renting lending swapping bartering gifting sharing
Power in the Sharing Economy Page 4
Power in the Sharing Economy Page 5 We want to identify power imbalances in the sharing economy and measures to ameliorate their effects.
Power in the Sharing Economy Page 6
Platforms facilitate the Sharing Economy – Power in the Sharing Economy Page 7 Platforms are however not neutral Platform Service Service Consumer 1 Provider 1 Service 1 Service n Service Service Consumer n Provider n
Power in the Sharing Economy Page 8 1 Differences in Bargaining Power Systematic reasons why the provider tends to wield less power than the platform side.
Power in the Sharing Economy Page 9 Take it or Leave it: Voice and Exit in the Sharing Economy Bargaining power in the sharing economy is the ability to communicate, negotiate, and influence users’ own activity, i.e. price setting, termination, terms and conditions....
Power in the Sharing Economy Page 10 An Employee by any other Name: Provider Classification Who wins in the battle over status designation as either ‘employee’ or ‘third -party independent contractor ’? What is there to gain? What is there to lose?
Power in the Sharing Economy Page 11 I Accept: Defining the Terms of Exchange The human limitations of information processing when it comes to ‘terms and conditions’ contracts enables sharing platforms to unilaterally determine the terms of exchange.
Power in the Sharing Economy Page 12 Knowledge is Power: Information Asymmetries Information asymmetries (in platforms’ favor) limit the capabilities of users to assess the profitability or parameters of sharing transactions. Is this true micro-entrepreneurship?
Power in the Sharing Economy Page 13 Opening and Closing the Channels of Communication Platforms mediate communication through software, determining what, how, and when comments can be made by users.
Power in the Sharing Economy Page 14 See you in Court (or not): Dispute Resolution Arbitration clauses deny users the option of legal recourse and ban on technical auditing ensures disagreements will be resolved in the platforms’ favor.
Power in the Sharing Economy Page 15 Individual to Group: Soft and Hard Collective Action Decentralization and hierarchization among users acts as a significant barrier to group identification and subsequent collective action.
Power in the Sharing Economy Page 16 SOFT ACTION e.g., blogs, fora, tribution ion online communities Hierarchizatio Individual Retr of Re Fear of + Hie Individual + Fea ion + Group Literacy + Decentralizatio through Globalization Identification Individual Physical Distance ction Lit … Dec Acti HARD ACTION e.g., Unionization, Strikes, Lobbying
Power in the Sharing Economy Page 17 2 Power imbalances through Algorithms Information and decision imbalances imbued into technology.
Power in the Sharing Economy Page 18 Algorithmic Reality: The Invisible Architectures of Power Algorithms are the new ‘middle men’ of business, determining the limits and nature of interaction between platforms and users.
Power in the Sharing Economy Page 19 Dynamic Pricing: Consumer Management & Manipulation Data privilege enables platforms to discover and exploit the limits of each user’s price points. How much are you willing to pay for a ride at night? At rush hour? With 1% battery life?
Power in the Sharing Economy Page 20 Algorithm is your Boss: Management through Software Computerized monitoring discourages ‘down - time’ and limits individual agency…. but also increases oversight and safety for customers. How much is too much oversight?
Power in the Provider Sharing Economy Page 21 Rating/Review Consumer Platform Payment Transaction Request Matches/ Presents Options
Power in the Sharing Economy Page 22 False Objectivity in Search and Matching Algorithms While helpful, algorithms on for-profit platforms are not neutral. They are strategically designed and skewed towards private interests.
Power in the Sharing Economy Page 23 SuperHosts: Reputation Mechanisms and Hierarchies Hierarchical ordering can create distinct circuits of high-status participants and low-status participants, dividing the group in the sharing economy on a value basis.
Power in the Sharing Economy Page 24 Platform Off- Platform Super-providers - Adherence to - Socio- Platform Policies demographically Successful desirable - Gamification (semi-professional) - Platform distinction markers - Frequent Use - High Successful Providers Rating/Ranking (doing ok) Failed Providers
Power in the Sharing Economy Page 25 Bias and Manipulation with Reputation Mechanisms Bias, including the overly positive valence of user ratings, presents a serious challenge. What can you expect from a five- star rating…and how far would you go to get one?
Power in the Sharing Economy Page 26 Algorithms and Discrimination User ratings can reinforce discriminatory practices through ratings and selection biases. There is only a thin line between user choice….and user discrimination.
Power in the Sharing Economy Page 27 Five Star Service: Emotional Labor in the Sharing Economy Rating systems, through their ability to determine the eligibility and ranking of providers, put consumers into the position of control.
Power in the Sharing Economy Page 28 3 Designing good Regulation The difficulties of regulating disruptive innovation.
Power in the Sharing Economy Page 29 Between Innovation and Protection: Regulation Experimental guidelines can regulate innovative products and services until there is more information available or until the technology is widely commercialized.
Power in the Sharing Economy Page 30 Finding Fault, Finding Responsibility: Liability & Regulation A lack of clarity over service legality leaves users potentially liable for unfortunate repercussions.
Power in the Sharing Economy Page 31 Quis Custodiet Ipsos Custodes: Approaching Self-Regulation Certain areas of the sharing economy can be regulated, such as insurance requirements, while others can be left to self-regulatory approaches. But who should draw the line?
Power in the Sharing Economy Page 32 The Rhetoric of Sharing: Framing and Narratives The initial framing of issues in the media has created path dependencies which determine the agenda for future policy discourses and debates.
Power in the Sharing Economy Page 33 From Disruption to Business-as-usual Sharing economy platforms continue to ‘disrupt’ traditional businesses, leveraging a power dynamic over other platforms, often as their primary strategy for growth.
Power in the Sharing Economy Page 34 Cultural and Voluntary License Taxes Prohibition Social Norms Partnerships Requirements Self-Regulation Co-Regulation Governmental Regulation Market Freedom Regulatory Control Voluntary Non-Voluntary Corporate Social Consumer Protection Responsibility Regulation Marketing Narratives Anti-Discrimination Corporate Transparency Regulation
Power in the Sharing Economy Page 35 Brainstorming on Power…
Power in the Page 36 General implications Sharing Economy Information Language and Asymmetries Narratives Algorithmic Regulatory Confusion Intermediation
Power in the Page 37 Implications for Platforms Sharing Economy Transparency with Consistency over Improved Channels Terms and Eligibility and of Communication Conditions Termination Criteria Reduction of Barriers Centralized for Technical Information Sharing Guidelines over Auditing and with Stakeholders Rating Valence Arbitration
Power in the Page 38 Implications for Providers Sharing Economy Determination of Informed Consent Price Control Status Collective Identity Fair Rating Systems Avoid Lock-In Effects and Action
Power in the Page 39 Implications for Consumers Sharing Economy Open Self Awareness Rating Fairness Communication Insurance and Legal Pop the Filter Bubble Vote with your Feet Awareness
Power in the Sharing Economy Page 40 thank you for your time Norwegian Business School (BI) Nordic Center for Internet & Society Nydalsvn. 37 / N-0442 Oslo bi.edu/ncis @BI_NCIS
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