Free Market Economics: Uber, Airbnb, & Feastly vs Government Regulation – Learn Liberty

Every day, it seems like there’s a new
service popping up that connects people who want things with
people who have things. If I want to go for a ride, I don’t have to worry about
buying a car or renting a car. I can get on my smart phone and in a matter of minutes, I can find
someone who’s willing to take me there. If I want a home-cooked meal, with
services like Feastly and EatWith, I’m able to just find people in my community,
that are willing to cook a dinner for me. They’ll even let me come
to their house and eat it. This is exciting stuff. But with all of this excitement, people are really trying to figure
out what do we do with this? This is something that we’ve
never thought of before. Now regulators are stepping in, and trying to figure out well how
do we treat these new services? But the question we really
are to be asking ourselves, is this any different than the way
we’ve ever done things before? Now let’s think about that for a minute. Let’s go back to my parents, 25 years ago. If my parents wanted to go out
on the town for the night, they’d have to find someone who is
willing to watch me and and my siblings. Typically they’d go down the street,
find Tori, the high schooler, and have her come on over and
watch us for the day. But that was really dependant on
whether Tori was available and whether Tori wanted to do it. The beautiful thing about
the sharing economy, is it’s taken this really simple idea of
community, and it’s no longer confined to the neighborhoods we live in and
the people we know. But it’s been extended
to the entire world. If I wanna go to New York or LA or Paris, I don’t have to worry about
finding a friend that’s gonna let me borrow their couch or
sleep in their room for the weekend. In a matter of minutes, I can get on the
internet, and have hundreds of rooms and couches available to me. This has huge potential for
consumers and producers. Unfortunately, all of these
potential benefits are at risk, and the sharing economy may
actually be stopped in its tracks. Old, outmoded forms of
regulation are being used to regulate these new
sharing economy firms, and they’re ultimately stifling their
continued growth and development. But the problem with that, is that the
Sharing Economy firms alleviate the need for these regulations in the first place. The two party rating system that Uber,
and Feastly, and AirBB, and most of these firms all employ, is a way
to overcome the informational problems that the regulations were put in
place to solve in the first place. If I have a bad experience with a driver,
I give them a bad rating. If a driver has a bad experience with me,
he gives me a bad rating. So, people with the bad ratings, no one
would want to trade, and borrow, and buy and sell from them. And the people with the good ratings
will get all of the business. And at the end of the day it pushes
everyone to be the best version of themselves that they can, to stay
in the market, without the need for regulations in the first place. So the ultimate question here is, will
policy makers evolve and adapt with all of these new firms coming in and the sharing
economy growing and blossoming as it has? Or will they apply yesterday’s regulation,
and yesterday’s theory to today’s economy, and all of the benefits that it has for
consumers and producers? [MUSIC]

Maurice Vega

37 Responses

  1. Regulation about protecting the consumer?  Now days, regulation is more about how government can get a piece of the pie.  What?  This gets around taxes?  We need to regulate and make sure it's "fair to others who are paying taxes"…

  2. Love your videos LL. Was wondering if you would do one on the topic of the gas tax. politicians claim it hasnt been raised in X years, but they never talk about how much the revenues have gone up due to increased traffic. (IE more gas is needed due to more cars = more $ in taxes due to volume)

  3. The recent success of the "Sharing Economy" seems to be proof that a "Voluntary Economy" is not only viable by practical. Subsequently, this seems to lend credence to the question of whether an Anarcho-Capitalist society could function harmoniously.

  4. Regulations were, and always will be, about protecting current businesses by barring new competitors. Ofc their excuses will always be the same: protecting consumers

  5. Yeah, but the rent-seekers don't give a shit. They're going to use and abuse any avenue they can to keep their monopoly.

  6. Government will crack down on these things when they realize they are not getting a cut.  Incidents like Uber drivers getting robbed will be the excuse cited but not the real reason.

    Think about it……….How many barter markets do you see nowadays? 

    If they send SWAT teams to raid collectives that sell in-pasteurized milk they will come squash your individualized services.

  7. As a person employed in one of the "old economy" businesses (hotel), it is so far not having a great effect on us yet, but I know it is down the road. Having the first wave knock out the travel agents and direct booking for online services was the canary in this coal mine. The question is, what can a smaller hotel like mine do to keep up?

  8. It's videos like this that make me excited to be alive in this time. We're seeing how individual liberty combined with the power of the internet is solving real problems without government of any kind.

    What frustrates me is that so many people are so ingrained with old thinking that even when this is at their fingertips and directly in front of their eyes, they just can't wrap their brain around the fact that it works, and it works better than any government agency could ever hope to work. Despite the fact that it's already working better than any government agency, they still demand that government get involved … because … GOVERNMENT! Obviously we need it!  /facepalm

    What gets me is that it's not just old people who think this way. It's some young people too … people who were so well indoctrinated in public school that their brain never gained the ability to conceptualize anything out of the 2 party big government paradigm they were fed from age 5 to 18.

  9. Recently a Dallas council woman proclaimed it wasn't fair to make people use services that weren't regulated. This was about UBER, because people are forced to use UBER, huh. Anyway, UBER drivers have to get two permits in Dallas now, all fair again.

  10. The question stated is an interesting one, but it implies two other questions: Can government regulate it? Are we going to let government regulate it?

    An example: If I use a site that is housed in Somalia or Bermuda to get a client in NY and receive pay with bitcoin, how is the regulation going to work? Is the site going to be different? I can tell a policeman that I am giving a friend a ride, and if it turns out he is my client is an under cover cop, he will certainly get a bad rating, probably including a picture.

    This means that it is an economic advantage to live in a deregulated state if you are going to set up one of these sites. What government will willingly send its enterprising people away?

  11. If it aint broke, dont fix it. If sharing is caring, this new system can turn a serviced based business seem useful. But take the caring part out and down goes the business along with quality of services offered. Remember, you get what you pay for, and if you dont care about yesterdays policies and why they were enforced in the first place, we all get a history lesson. Is there an app that tracks ones laziness with an annalysis of productivity towards the brains reward system? Sometimes you have to go get your own car and go apt. Hunting on your own somewher3 youv never been and feel the sence of accomplishment of your own hard work. If i have it and you want it, you will never get your own if you keep renting mine. But saving up to get your own is more rewarding and guaruntees independance. Besides what if im not in the mood to share one day and charge more to borrrow my time and the thing you dont have. Youd feel like a scrub depending on an app to find a ride. No thanks, id rather walk

  12. When it comes to meals, don't we need regulations to ensure that it was prepared in sanitary conditions and with non-expired ingredients?

    And when it comes to renting via a service, how would you deal with squatters who initially pay and then refuse to leave?

    I really like the idea of the sharing economy and I'm not trying to attack it. I just want to know what solutions it has come up with–other than a rating system–to deal with issues between the consumer and producer.

  13. Regulations are an important way for professional associations to protect and strengthen their monopoly on the services they offer. By limiting competition, they are able to maximize the income for their current members while raising the bar to dissuade competition. For example, you are perfectly welcome to compete in the market of massage therapy just as soon as you complete your 1,500-hour certification.

  14. The supposed "information problem" is in reality non-existent. I mean, look at prices, for starters, and people have always found ways of finding the information regardless of difficulty. And it has become even easier because of the Internet.

  15. the government needs more regulations and taxes on these new companies. if new companies are allowed to thrive, they will take business away from services that we already have and a lot of people will lose their jobs. special interests need to get involved so that the big companies that hire more people don't lose business. small businesses are the real problem here. they don't pay high enough wages. new businesses like uber are bad because they offer the wrong services. people don't know what services they really need, so the government needs to regulate services we don't need out of business.

    I want to be a government regulator some day. Am I doing good so far?

  16. What a great way of explaining the "sharing economy" and why regulators are against it haha….at risk….Those big bad regulators trying to keep people from making a profit! HA! Let me tell you about the "old outdated" forms of regulation. In my city we have zoning- vacation rentals are not allowed in areas zoned residential– they are allowed in areas that are not zoned residential. I was evicted from my apartment over the summer so my landlord could "be the best version of himself" by making 4x the amount of money on airbnb….thanks "today's economy". He now rents out my old apartment for $225 a night on airbnb and it seems to be renting 20 nights a month. Meanwhile there's nowhere else for me to rent within 30 minutes of where I work in town. Mind you…he's renting in an area that is zoned residential- where vacation rentals are strictly prohibited. Airbnb keeps pushing my city to "de-regulate" …meanwhile the locals are being kicked out of their apartments to make way for this "new economy". Who paid for this inane manipulative video?

  17. Like what you see and want to hear more? Tune in as Professor Koopman joins us LIVE on Periscope Tuesday November 17th at 3PM EST.

  18. I would like to see sharing profit app… All this unregulated things will collapse the economy….. Because they are not creating a middle class they creating poor people society, nothing good will be in the end

  19. If you like this kind of discussion, be sure to head on over to Learn Liberty's "Government Regulation and Technology" on demand program:

  20. Learn Liberty was paid by Uber/Air BNB to produce this video. Not all govt regulation is bad – ex, the insistence that Air BNB houses have smoke detectors and carbon monoxide detectors, or that Uber drivers pass criminal background checks and their vehicles pass basic safety inspections.

  21. According to the news, in several weeks, online taxi business in my country will be subject to regulations of floor price and drivers limit. I'm very triggered about this because their reasons don't make sense.

  22. This little reality, and the euphoric high of civic speculation it propagates, ends when or if, your service fails or the battery runs out.

    Paying more attention to reality means going out and investing in what it is.

    Here's a clue: Most of our reality is based off of our human environment, versus the physical environment. That human environment hasn't resolved it's own stability yet, and it's still an open question if it can–and how much time AND opportunity is left for that to occur.

  23. Its not realistic to merely trust that uber drivers will have their cars meeting safety standards. The regulations are their for certain consumer protections for things that you really want to avoid, like terrible accidents. If have a terrible accident in an uber, I doubt your 0 star rating will do anything. Plus it makes it fair for the service providers who are meeting the proper standards. We can't dismiss the fact that these regulations came into existence for a reason in the first place.

  24. Uber – pays drivers less than they spend on travel. Uber drivers dont have to be good and driving and can kill you. They dont have to obide any standart. No rating system can replace government control, just think about when is the last time you gave your fastfood good rating after eating there. They kill taxi services where government assured that driver is professional. Geez i wonder why is it that government feels like protecting its citizens.

Leave a Reply

Your email address will not be published. Required fields are marked *

Post comment