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Juliet Schor: On the Connected Economy and Carbon Emissions

Juliet Schor

The “Connected Consumption and Connected Economy Research Project,” led by Juliet Schor of the Boston College Sociology Department, is a study on the social, environmental, and economic impacts of the “new sharing economy.” Schor recently discussed her work and shared thoughts on what we can (and can’t) conclude about the carbon impacts of this sector.

By Tori Scarzello ‘13

Are you a “connected consumer?” If you’ve ever stayed at an Airbnb or grabbed a ride with Uber, you’ve participated in the “new sharing economy,” a market system predicated on peer-to-peer sharing of access to goods and services as an alternative to traditional means of private ownership. Also known as “connected consumption,” “collaborative consumption,” and the “connected economy,” the sharing economy has quickly gained attention for its potential to foster economic opportunity, ecological sustainability, and social connections.

For Professor Juliet Schor of Boston College’s Sociology Department, the sector is the central focus of the “Connected Consumption and Connected Economy Research Project,” an exploration of the practices of connected consumption and the sociological significance of the new sharing economy. As part of her work with the MacArthur Foundation’s Connected Learning Research Network (of which she is a member), Schor is leading a team of researchers in the study of various platforms and practices of the connected economy and the social, economic, and environmental impacts of this sector. Since 2011, the team has focused on a number of case studies incorporating various market orientations and structures, from time banking to makerspaces; from local food swaps to brands such as Airbnb, RelayRides, and TaskRabbit.

Schor, whose areas of research include issues of work, consumption, and sustainability, first became interested in the connected economy while studying the relationship among working hours, carbon emissions, and consumption. “Shorter hours of work is a key component of the model,” she asserts. Economies with shorter hours of work on average tend to have lower economic activity and therefore lower carbon emissions. However, “if people are earning less in the market, they also have more free time,” says Schor. “How are they going to manage their consumption? Are there other ways that they might begin to earn money that are lower carbon footprint?” These questions prompted Schor to examine do-it-yourself (DIY), self-provisioning, and other activities that are part of what she calls the “new household economics” that emerged following the 2008 economic downturn, when people tended to have less money and more free time. As individuals turned to alternative means of supporting themselves, income streams became less specialized and more diversified, affording people the time and freedom to make and do things that provided fulfillment and high satisfaction. Embodying the values of autonomy, resilience, sustainability and creativity, these alternatives set the foundation for the “new sharing economy.”

What began as an organized system of peer-to-peer exchanges has evolved into a diverse set of platforms and organizations comprising both for-profit and non-profit market structures, incorporating business-to-peer as well as peer-to-peer exchanges. The “new sharing economy” generally covers four broad categories of economic activities: recirculation of goods, increased utilization of durable assets, exchange of services, and sharing of productive assets. Leading industries in this sector include living space, transportation, and casual work; companies currently at the forefront of the sharing economy are those that provide a technological platform (websites, apps) through which participants can “share” possessions (cars, apartments) with others for a price. Schor emphasizes the importance of the social and digital elements of the sharing economy model, arguing that technology has played a critical role in enabling market participation by reducing transaction costs. “Technology is key because it changes the cost structure and makes it much more feasible and productive for individuals to get involved in these markets,” she explains, pointing out that the success of the model has been driven by participants’ (mainly young people) comfort with sharing with strangers and willingness to use new technological platforms – behaviors that are closely linked to contemporary web culture.

While the sector is often characterized as less resource intensive and thus having a lower-carbon footprint, the question remains: how green is the sharing economy in practice? Schor acknowledges that she was surprised by “the pessimistic story about ecological impacts” that emerged in her research. “From a carbon point of view, a lot of these activities are not reducing footprint,” she says, using the example of Airbnb to illustrate how activities in this sector directly and indirectly influence household patterns of consumption in ways that impact the overall carbon footprint of the connected economy. “What we found is that people who use Airbnb travel more because it’s cheaper to travel…These activities put money into people's pockets which they then go out and spend.” The sharing economy stimulates economic activity not only by enabling buyers to purchase more of a good or service because of the lower cost, but also by providing sellers with more income which they can then spend on other goods and services. While the sharing economy may promote the consumption of lower-carbon alternatives, the issue is whether the consumption choices that participants make with their additional income ultimately lead to an increase in carbon emissions.

In addition to economic growth and household consumption, the sharing economy is linked to carbon emissions through an additional pathway: income inequality. Currently, Schor and fellow professor Andrew Jorgenson, also with BC’s Sociology Department, are conducting research on the impacts of income distribution on carbon emissions. “What we’re finding is that in wealthy countries, higher levels of inequality lead to higher emissions,” explains Schor, also noting that the sharing economy has further contributed to the concentration of income at the top because highly-educated, higher-income people have been benefitting more than any other group from activities in this sector. The connection between income and carbon emissions in the sharing economy is clearer still when one considers that higher-income people also tend to have higher carbon emissions. Still, Schor notes, the diversity of activities in the sector makes it difficult to analyze and draw conclusions about its social and environmental impacts. “What the ultimate impact of the sharing economy on income distribution is, we’ll have to see.”

With impacts going in multiple directions, it seems that for now the sharing economy is still constrained by the classic equation between economic activity and carbon emissions; that is, increasing the former leads to an increase in the latter. But is connected consumption just a passing trend with flashy apps and promises of healthier, happier lifestyles? Quite the contrary, says Schor. “I think the sharing economy will expand; the question that is still not answered is the extent to which these entities are going to end up acting like the businesses that they supplant or compete with.” A relatively new movement called platform cooperativism - online platforms that are owned and operated by workers and users - could hold promise as a new business model within the sharing economy that could help ease income inequality – and by extension, environmental impacts. “If platform cooperatives spread,” says Schor, “it would spread wealth more evenly, which could have a really positive impact on things, including emissions.” If one thing is clear, it’s that as the sharing economy continues to evolve, it will continue to have both direct and indirect impacts on our communities, our consumption habits, and our carbon footprint.

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