Questions & Answers
Will Peer-to-Peer Markets Dominate Our Future Economy?
Arun Sundararajan, professor or Information, Operations, and Management Sciences at New York University Leonard N. Stern School of Business, discusses the likelihood of today's market transitioning to a rental economy.
Transcript
Will peer-to-peer markets dominate our future economy?
Whether or not the sharing economy is going to dominate the economy, how much it will grow, whether rental is going to become all-encompassing—the answer to those questions is in part dependent on the industry that you're talking about. For example, I think that point-to-point urban transportation, or taxi-like service, will be dominated almost entirely by the new peer-to-peer marketplaces. On the other hand, I fully expect that Airbnb and hotels will coexist. Hotels have a special place in a lot of consumers' hearts. They are familiar to a lot of consumers and are superior alternatives to Airbnb for certain kinds of business travel. I also think that it will take at least a generation for us to move away from associating ownership with our own sort of personal economic development. I don't think that we will transition completely to a rental economy. People like to own stuff. What's going to transition is where you don't necessarily want to own it, but the only way that you can use it is if you own it. Hopefully, we will transition to an economy where you don't have to have 50 power tools of different kinds in your tool shed, and instead we transition to a place where you can rent it fluidly, or borrow that fluidly, or share it fluidly with your neighborhood.