In my previous post I discussed the rise of the sharing economy and similar innovations as well as their implications for employment. However, I probably left you with an unsatisfactory feeling, wondering how and whether this economic system is beneficial for society or not. In this post I will try and provide you with some type of answer.
There are always two sides to this discussion and one side is from society’s perspective and the other side is from the individual’s perspective. Here I’d like to have a quick look at both and explain how we can get the most out of these economic systems. In my eyes, the answer revolves around education.
Like the guilds that fell before them, the experts whose jobs are eroded away by crowd-based activities are often replaced by easier and cheaper access to services and products for society. Based on this one would think that the rise of things like the sharing economy seem to be intuitively good for society. The question remains what to do about the newly unemployed?
I think that the answer lies in education and retraining. In fact regardless of what one thinks of the shared economy, providing easy access to education never seems to be a bad bet regardless of the reason why. Neither for society nor for the individual. It is well known that education bestows significant benefits on individuals such as,
- Children and youth acquire more expanded social capabilities than those not in school,
- There are large direct effects of education on status attainment,
- Even a direct causal role in occupational transition even late in the individual’s career.
There’s more than one way to educate a person
For our society, there are strong arguments that investments in education lead to a stronger economy. For example economists infer the aggregate positive economic effects of education based on the income differentials between educated and less educated. However, there are more direct correlations between investments in education and a stronger economy when one compares different countries.
However, there’s more than one way to educate a person. One could also argue for skills training on the job, paid for by the employer not the government. However, this seems risky for employers because they pay all the costs but the employee has all the benefits and could easily leave the job to a new employer (if such training doesn’t create loyalty). Hence, logically one would believe that universities need to supply this because employers would have too low incentives to provide it. In addition, a taxi company would hardly be prepared to send its drivers to programming courses to improve their employability.
In the 19th and early 20th century it was schools that provided the education and for most jobs it was sufficient. Because technology has advanced, now it’s the universities that need to fulfill this role. So, if we wish to provide benefits for society with the great advantages of the shared economy and at the same time give individuals a chance to adjust to the new economy, then education is the key.
If you agree with this, then you will obviously be concerned by the escalating higher education fees over the last 50 years. This has made education unaffordable for millions of people. If the government decides not to support this necessary training by somehow reducing education fees, then one can only hope that the appearance of massive-open-online-courses or similar ideas will be able to fill the gap. Based on massive-open-online-courses poor completion rates and limited focus, this solution still seems a way off.
So the sharing economy seems to be good for society, we just need to make sure it’s also good for me an you. My opinion is we need to keep people educated and equipped with the right skills for today to make sure the system is sustainable. To achieve that, we need to increase the access and affordability of education. As Alvin Toffler once stated “The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn.”
image credit: bensonk42 at Flickr
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Evan Shellshear is a technology and software expert working as the Point Cloud Manager at the Fraunhofer-Chalmers Centre in Sweden. His work focuses on turning cutting-edge research into successful industrial solutions across numerous industries. Connect with him @eshellshear