Regulating the Sharing Economy

Services like Uber, Lyft, and Airbnb have revolutionized private taxis and temporary housing rentals. At the same time, these large-scale sharing economy services are in their infancy, and legislators often disagree about whether or not to regulate them, and if they do, how to regulate them.

Many cities, like New York, are concerned about the effects that Airbnb may have on affordable housing, while others have been far more accepting. Following the footsteps of San Francisco, London recently announced that they will be legalizing Airbnb, which is prohibited under the current legislation. The new legislation will allow homeowners to rent out their properties for up to 3 months of the year. While some support the move, stating that the current legislation is outdated and inconsistently reinforced, others fear that legalizing Airbnb will disrupt neighborhoods and reduce the amount of long-term housing for locals, therefore driving up the cost of rent.

Services like Uber are also troubling to local governments, because they operate outside the scope of traditionally established laws for private taxis. As a result, they’ve forced traditional taxis to reform their operations and improve the quality of their service. However, because they aren’t governed by traditional taxi laws, there are concerns over whether or not their insurance is adequate and if their drivers have been vetted enough. Not only that, there are currently no laws requiring Uber to provide services to people with disabilities, or to people who don’t have Internet access or credit cards.

Despite all the headaches that these sharing economy services give to legislators, one thing is certain: they are innovative and challenge the status quo. It’ll be interesting to see how cities will regulate these services, but hopefully they’ll able to do it in a way that won’t stifle innovation.