Back in 1942, economist Joseph Schumpeter said creative destruction is the way of the free market. It’s messy but as an entry in The Concise Encyclopedia of Economics explained:
“Lost jobs, ruined companies, and vanishing industries are inherent parts of the growth system. The saving grace comes from recognising the good that comes from the turmoil. Over time, societies that allow creative destruction to operate grow more productive and richer; their citizens see the benefits of new and better products, shorter work weeks, better jobs, and higher living standards. Herein lies the paradox of progress. A society cannot reap the rewards of creative destruction without accepting that some individuals might be worse off, not just in the short term, but perhaps forever.”
At first, the collaborative or sharing economy was thought to be a response to the Great Recession. Some people needed to reduce costs and others needed to make money, so they found ways to use resources more efficiently by making the most of available time and assets. This is affecting companies in a variety of industries:
Whether you want to provide or consume goods or services – cooking meals or eating them, running errands or having them run, hosting a pet or leaving one behind while you’re on holiday – there is probably someone out there who is willing to share their resources.