We all know about demographic transition, but don’t you think that our economies are undergoing changes?
Yes, economic development is happening. Initial stage which is before the industrial revolution, the sector which contributed more to our economy was the agriculture sector. After the industrial revolution, things have changed a lot. ‘Men were replaced by machines’, people started working in the manufacturing sector (for many reasons, but mainly for better life conditions), thus most of the countries started growing and major share of GDP was from the manufacturing sector. What’s the condition right now?? Consider India, from where does the major share of GDP comes from? Of course, it’s from outsourcing their IT skills, thus the major share of GDP comes from the service economy. It was Agriculture then moved to manufacturing and now in the Service sector, where are we moving to?
It is Shared economy! We know that we are in the booming era of technology, Technology is progressing at light speed. Development in technology (IT sector) will drive us from the service sector to the sharing economy. How?
Think about OLA, UBER, SWIGGY, AIRBNB, OLX, etc. they speak themselves. They are the initial examples that I could give now for the transformation of the service economy to a sharing economy. So, what is shared economy and how it works?
Shared economy the name says it all, it is an economic model based on peer-to-peer (P2P) activities of acquiring, providing or sharing access to goods and services that is often facilitated by a community based online platform.
1. So, the future is all about you being your boss, you will share and earn.
2. Shared economies will end up in reducing ownership. To be precise, instead of owning you can share things that you don’t use.
3. You will be having a handful of opportunities e.g.: Airbnb is now replacing earlier concepts of hotels.
4. Shared economies will bring in trust and confidence among the community.
Building trust and confidence among people is one among the few major challenges faced by shared economies. For the time being it is all about making the right trade-off! E.g.: Airbnb – You should make the perfect trade-off among reliability and price. But still, as fast these trust issues are solved the future will be taken by Shared economy.
What is its scope in developing countries? What do you people think?
Comment below and join the discussion!