The document discusses regulation of sharing economies. It begins with an overview of sharing economy concepts and characteristics, including definitions that emphasize peer-to-peer access to goods and services. Issues discussed include the redefinition of traditional jobs in favor of gig work and how this challenges labor laws. The document then examines different regulatory approaches, highlighting challenges with conventional regulation for new sharing economy platforms. It proposes a collaborative, self-regulation model where companies set standards negotiated with governments and use customer ratings and banning from networks as enforcement mechanisms.

1. Regulation of Sharing Economies
Mohamad Mova Al’Afghani, PhD
mova@alafghani.info
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

2. Today’s Sessions
• Session 1:
Sharing Economies
• Session 2:
Applying Regulatory Theories
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

3. Session 1:
Sharing Economies
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

4. Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

5. Sharing Economy Buzzwords
Sharing Economy
Collaborative Economy
“On Demand” Economy
“Peer to Peer” Economy
Collaborative Consumptions
Mohamad Mova Al'Afghani, Regulation of Sharing Economies | MBA-ITB, 2016

6. Characteristics
1. Consumer to Consumer (Peer to Peer)
2. “Underutilized” Assets
3. Temporary Access
4. Platform/Marketplace
5. Trust and Reputation
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

7. Definitions
How do you define “sharing” economy?
”The peer to-peer-based activity of obtaining,
giving, or sharing the access to goods and services,
coordinated through community-based online
services”
(Albinsson & Perera, 2012; Belk, 2010; Botsman &
Rogers, 2010; J Hamari, M Sjöklint, A Ukkonen
2015)
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

8. Botsman, 2013
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

9. Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

10. Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

11. Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

12. Is sharing still caring?
1. Original “sharing” economies (ride sharing,
nebengers). Shared value creation
2. Networked Monopolies
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

13. Networked Monopoly
Derive values entirely from the network of users
rather than from producing a more easily replicable
product or services
=
Monopoly Power
Crowdsourcing Networked Monopoly
(RSA)
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

14. Job redefined
Current capitalism conditioned corporations to
“…lessen their reliance on full time workers and
increase the utilisation of part time, contract
workers for cost-saving reason”
(Grossman and Woyke)
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

15. An issue in Labor Law: “Job” Redefined
Source: OnForce
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

16. An issue in Labor Law: “Job” Redefined
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

17. An issue in Labor Law: “Job” Redefined
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

18. An issue in Labor Law: “Job” Redefined
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

19. Gig Workers on the Rise
Traditional Labor Law:
1. Authority, 2. Wage, 3. “Defined” Jobs
What about gig works?
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

20. How can we protect “gig workers”?
1. Health Insurance
2. Pension Benefits
3. No-work pays
Trust funds? Increase Standard Premiums?
Special Insurance?
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

21. Rate/Commision Fixing
Networked Monopoly+Gig Workers=
Rate/Commission Fixing
Sounds like
another
“exploitation”
huh?
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

22. Session 2: Applying Regulatory
Theories
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

23. Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

24. Law=Regulation?
Authoritative rules backed by the legitimate
coercive power of the state
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

25. What is Regulation?
(Black, 2002)
1. The promulgation of rules by government
accompanied by mechanisms for monitoring and
enforcement, usually assumed to be performed
through a specialist public agency.
2. Any form of direct state intervention in the economy,
whatever form that intervention might take.
3. All mechanisms of social control or influence affecting
all aspects of behaviour from whatever source,
whether they are intentional or not.
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

26. Regulation: Characteristics
(Hood, 2001)
1.Standard Setting
2.Information Gathering
3.Behaviour Modification
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

27. Will Conventional Regulation Works?
Is Uber = Transportation Company?
Is AirBNB = a hotel? (hospitality
industry)
Is Mint(.com) = a Bank?
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

28. Blockchain = Almost Zero Accountability
https://blockchain.info/
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies
Source: WEFORUM

29. Self Regulation
More Decentralized “Platforms” = High
Regulatory Cost
(i.e. don’t spend taxpayer’s money supervising
them all!)
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

30. Self Regulation (collaborative
regulation)
Companies as “regulators”
1. Higher incentive
2. Lower enforcement cost
3. Less burden to taxpayers
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

31. Self Regulation
1. Government determined goals
2. Company set standards (negotiated regulation)
3. Company enforce standard
4. Enforcement mechanism: rating (by consumers),
disband users from network (by companies)
5. Government sets “ultimum remedium” for
company
6. Government benchmark
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

32. The Role of Law in Regulation
Morgan and Yeung, 2007
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

33. Service Standard in Public Transport
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

34. Service Standard in Public Transport
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

35. Service Standard in Public Transport
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

36. Service Standard in Public Transport
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

37. Service Standard in Public Transport
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

38. Sharing Economies: Self Regulation
(Ogus, 1995)
First, since self-regulatory agencies (hereafter SRAs) can normally
command a greater degree of expertise and technical knowledge of
practices and innovatory possibilities within the relevant area than
independent agencies, information costs for the formulation and
interpretation of standards are lower. Secondly, for the same reasons,
monitoring and enforcement costs are also reduced, as are the costs
to practitioners of dealing with regulators, given that such interaction
is likely to be fostered by mutual trust. Thirdly, to the extent that the
processes of, and rules issued by, SRAs are less formalized than those
of public regulatory regimes, there are savings in the costs (including
those attributable to delay) of amending standards. Fourthly, the
administrative costs of theregime are normally internalized in the
trade or activity which is subject to regulation; in the case of
independent, public agencies, they are typically borne by taxpayers.
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

39. Trust=the new regulatory tool?
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

40. Trust=the new regulatory tool?
Trust = “currency” in the sharing economy
1. Is it reliable (does it reflect the true value of
the services?)
2. Can it be improved (and how?)
3. Can we harness rating system as regulatory
data? (e.g. for benchmarking purpose or
perhaps enforcement mechanism)
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

41. The Proposal: Self Regulation for Uber,
Gojek, etc
1. Reputation system (kind of) work, can be
improved
2. Enforcement cost (e.g. banning drivers from
the system) is very low
3. Intrinsic interest for service standard and
trust-building (e.g. Gojek provides Helmet)
4. Reduced regulatory cost (less burden to
taxpayers)
5. Learning by doing (“regulating” by doing)
Mohamad Mova Al'Afghani, Regulation of
Sharing Economies

42. Mohamad Mova Al'Afghani, Regulation of
Sharing Economies