Collaborative Economy - Explained
What is the Collaborative Economy?
Written by J. Mance Gordon
Updated at April 23rd, 2024
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What is the Collaborative Economy?
A collaborative economy is a type of economy where consumers rely on one another for the satisfaction of their needs. This means consumers are able to get what they need from one another.
A collaborative economy is otherwise known as a peer-to-peer economy or a sharing economy.
How does a Collaborative Economy Work?
In a collaborative economy, a consumer who is in need of a product or service approaches another consumer who has it and is ready to release it and they collaborate to meet each others needs.
What are the Key Aspects of a Market Economy?
Crucial to a collaborative economy are activities like:
- sharing,
- trading,
- swapping,
- borrowing, and
- lending of products between consumers.
The sharing, swapping or renting is often done for a fee.
What is the Role of a Middleman in a Collaborative Economy?
The presence of middlemen in a collaborative economy is essential. They facilitate the exchange, distribution or sharing of goods between consumers.
Why is the Collaborative Economy Decentralized?
A collaborative economy uses a decentralized network that allows consumers to get what they need from other consumers in the market place.
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