Shutting Down The Shares

Last week the city of New York fined an Airbnb host $2,400 for violating a law against “illegal hotels.” Emily Badger suspects that more cases like this will trigger a reassessment of city codes:

It’s reasonable for cities to create some standards for how residents might operate what the [Sustainable Economies Law Center] calls “host homes” or “no-host homes.” Perhaps regulation could require the host to register the property for a small fee, while limiting the number of nights in a year that guests can stay there (this could be a concession to neighbors who don’t want their block or building to become a revolving door for tourists). The SELC also floats a cap on the income that a host can make in a year, tied for example to the cost of actual rent or the market value of a property (for example: your Airbnb income can’t exceed 75 percent of your actual yearly rent and utilities).

This last idea would certainly codify the notion that the “sharing economy” is fundamentally a different kind of economy, one where the ultimate goal for individual participants isn’t to make as much profit as possible.

Marcus Wohlsen insists government will have to make way for the share economy sooner rather than later:

New York is a city built on bureaucracy, and bureaucracies are inherently resistant to change, especially when a new technology comes along to undermine the assumptions on which those bureaucracies were built. And in a way that’s by design. The mechanization of the economy and the mechanization of government have occurred in parallel, often in the form of agencies meant to check industries’ more flagrant violations of the social contract. In a sense, those bureaucracies’ express mission is to hinder progress.

Still, renting out your room when you’re not home or your car when you’re not driving it hardly feels flagrant. If people and the politicians they elect feel the same way, these bureaucratic roadblocks to the sharing economy’s rise will also turn out to be very temporary. Whether or not Airbnb, RelayRides or Uber turn out to be the companies that define the future of sharing, the idea of using technology to leverage any resource’s excess idle capacity seems too sensible—and popular—to fail.

Walter Mead nods:

In the case of Airbnb, New York City’s zoning and administrative codes were so numerous and confusing that the client hit with the fine had no idea that he was breaking the law simply by renting out his room. A legal system in which the average citizen can’t make sense of when or how he or she is doing something illegal is not only unfair but a serious detriment to quality of life. America is not going to create the service jobs it needs to stay vital in the post-industrial age by making it hard for small-time entrepreneurs to succeed.

Previous Dish on Airbnb and the share economy here, here and here.