It’s makes a ton of economic sense. You avoid the upfront purchase costs that can be a barrier for people with limited resources. You need thousands to purchase a car. You need hundreds buy serious tools. Avoid that by renting. Anything that requires financing means that you are paying extra just to get the money to fund the upfront costs of purchase. That is economically wasteful.
You also only pay for your use. I read that the average drill is used for 15 minutes in its life. I used to spend $20 per compact disk that I listened to for maybe 20 hours. That’s a lot of money for limited use. With movie/music ‘rental’ via a streaming service I pay maybe $10/month and get to consume as much music/movies/TV as I want. That’s good value for use.
Renting is also (generally) convenient. Streaming is easy. I’m seconds away from millions of hours of movies/TV/music.
A big barrier to the sharing economy that used to exist was trust. You never knew how trustworthy the counterparty was. Now, there are all sorts of tools to ferret out the trustworthiness of your counterparty - primarily through some sort of rating from former customers or other methods.
Another barrier that has been reduced is the digitization of our lives. The idea of having bookshelves full of CDs/books/DVDs is now kind of silly. You can now have all that on a hard drive somewhere. Owning all that stuff just doesn’t make sense.
I think sentimentality has a tendency to be more of a vice than a virtue. People who get so attached to their possessions tend to be the kind of people who won’t pick up and move to find a better job or escape a crappy situation. That mentality might have been tolerable in a more idyllic era. But that era isn’t now, especially if you’re young and trying to get your career off the ground.
Good link, one of those articles that really gets me to thinking about coming change.
The Millennials are a really interesting bunch to me; they seem both more individualistic and more collaborative at the same time. I don’t think they’ll stop at sharing cars and bedrooms, either.
The sticking point is when something transitions from being a true sharing society thing to a way of evading regulations put into place for a reason. Uber as a better ride sharing board, the kind you see in a college, is great. Uber today is trying to sign up full time drivers and not paying benefits or covering liability, except as a last resort. Not so great. AirBnB, which I love, started as a way of making money off of spare rooms and couches. However all the places we’ve stayed are pretty much 100% AirBnB, and is a way of opening up a small hotel without the overhead.
Some books I’m happy to borrow. Most I want to have, especially because I collect old books and magazines. However I have no desire to own DVDs except in some very rare cases, so it is Netflix for me.
It all depends on your circumstances.
We unfortunately see a lot of the same mentality in corporations. Sell off valuable assets and then lease them back, costing them far more in the long run, but due to accounting magic, somehow coming out ahead.
Yes, I spent a large amount of time in the library when I was younger and yes, now a lot of that can be found on the computer which negates the usage of the library.
Interesting that many people in the big cities would rather borrow or rent a car rather than own one for themselves and then use the rental
I was wrongly associating the zip cars with communism.
Not all places have bus service and then there is the entire cost of the bus service which is typically subsidized by the government.
Yes, I know what you mean by this specialization that seems to be becoming more popular
Looks like I really got a lot of people going which means that I must have touched a nerve for many people and fyi I am part of gen X.
I was not intending to bitch at Millennial but it certainly took its toll.
Yes, a lot of Millennials are extremely hardworking people. That was not my point. What I was pointing out is that the typical Millennial is far more likely to rent stuff rather than own it as the previous generations did,
This change is going to be something that a lot of the previous generations (including myself) is going to have to deal with.
A lot of people don’t want to move because they are happy where they are and have family and friends locally not to mention the schooling for their children.
Believe me, it is not easy to pack up an entire family and move across the country in search for a more suitable job or better situation
Have you ever heard the term “The grass is greener on the other side of the fence”
There are many reasons that relocation can be an undesirable choice, and a mountain of possessions is not one of the important ones.
Some people are naturally more rooted than others. For every under-30 who can barely stay in one place for five minutes and thinks nothing of jumping 2000 miles for a job they know will only be short-term, there are probably a multiple who prize roots in a community or place enough not to abandon their baggage every time the wind shifts.
No, this is different from specialization. While specialization is inevitable as economies grow in size and complexity, what we’re seeing now is a shift from greater ownership of assets by their users to concentrated ownership combined with short-term leases or licensing models to users.
That you live in a house you didn’t build, listen to music you didn’t record, and use software you didn’t write isn’t surprising, but the fact that you are more likely to rent that house than own it, listen to music on Spotify than buy CDs, and pay a monthly fee for that software as a service rather than buy a CD-ROM is new. Perhaps soon you’ll subscribe to a wardrobe service, so you can always have new and well-maintained clothes to wear.
I tend to believe that for the depreciating assets like cars or music collections, this is almost certainly a positive development. But it does worry me to concentrate ownership of appreciating real estate, since that has long been one of the few large assets that has been widely owned and has long representing a very large fraction of the net savings of most Americans. We’re clearly not at problems levels, since we still have 1990 levels of home ownership, but the trend is the opposite direction from then, so it makes sense to worry about it now even if we didn’t worry about it then.
I’m not sure the relevance of this, but if you’re going to throw it out there, it’s worth pointing out that private transportation is also subsidized: roads, highways, free parking in many places…
I think you have to entirely discount the 2001-7 housing boom. It was not just artificially inflated, but possibly artificial in other respects as well. It was a perfect storm of several powerful industries seeing an opportunity to spin gold from dreams of homeowning. Billions upon billions in wealth were created almost literally out of the thin air over housing development lots.
I haven’t done the specific homework, but I suspect that if you extrapolate using more grounded and linear assumptions, we are not in any particularly down time as far as home ownership levels go.
Yes, and that is an example of how government/public/subsidization activities increase everyone’s wealth.
Subsidizing transportation reduces costs for everyone. It makes cities more livable and pleasant for everyone. It saves everyone time. It lets people live healthier lives. It lets people more time (to care for their children, to engage in charity, to engage in creative work or entrepreneurship). It makes services cheaper.
The same thing is true for subsidized education, subsidized child care, subsidized health care, and all kinds of other things.
A world in which everyone around you is more secure, more healthy, more happy, etc., is a world in which you are more secure, more healthy, more happy, etc.
Looking at a subsidy solely as an expense ignores the fact that it makes living cheaper for everyone and makes everyone wealthier.
I didn’t know about Office but I knew about Adobe. That was designed to prevent piracy though, it wasn’t because anyone wanted it. The Adobe Creative Cloud wiki page contains phrases like “was met with significant criticism” “caused disagreement and uncertainty” “incited annoyance and conflict” “the negative reaction across segments of Adobe’s user base was swift” “caused an unprecedented loss of trust in Adobe as a company.”
