The Sharing Economy reflects the crisis

While debates about the politics of digital platforms are crucial for employment rights and housing, they also concern legitimacy, corporate power and contemporary capitalism. That is because of the context for the emergence of lean platforms, their claims about their relationship to the global financial crisis, and the difficulties in their regulation and governance so far. This chapter is about the context to the emergence of lean platforms, and platform rhetoric, the constellation of stories, categories and semantic games used by platforms and their allies to frame and shape reality in a way intended to shape regulation through processes and trajectories that are described in Chapters 3, 4 and 5.

Since the 2007/2008 crisis, and arguably since the alter-globalisation movement, economic orthodoxies and common sense around neoliberalism have become increasingly scrutinised and challenged. The financial crash and its main drivers, especially the sub-prime mortgage boom in the United States, is widely regarded to have resulted from the quintessentially neoliberal deregulation of banking sectors, especially the 1999 repeal of elements of the US Glass-Steagal Act, which once again permitted financial institutions to engage in banking alongside riskier investment operations (Krugman 2008, Stiglitz 2010, Aalbers 2016). The subsequent bailouts of banks at the expense of populations, through public service austerity, and the recessions that followed, led to wage stagnation, underemployment, price rises and a global wave of outrage around the compromising of democracy, peaking between 2010 and 2013 in the so-called ‘Arab Spring’ and the Occupy movements (Brannen et al 2020, Bevins 2023).

The rise of new digital platforms was made possible by the neoliberal response to a crisis of neoliberal capitalism. At the same time, platforms presented themselves as part of the answer. Platforms, it was argued, were part of an alternative economic model that opposed incumbent corporate elites with a collaborative and communitarian alternative (see the section on ‘The rise and fall of the Sharing Economy category’).

Several wider transformations of capitalism and digital technology are helpful in contextualising the emergence, significance and power of platform businesses.