• Client: European Commission - DG Environment
  • Implementation period: 2017 - 2017 (Completed)
  • Geographic coverage: European Union

Is the collaborative economy good for the environment?

The emergence of the collaborative economy or sharing economy is a fascinating new trend. Emerging business models (for example, Airbnb, Uber, and Peerby) blur the distinction between private and professional services, and change the way we work, interact, and organise our lives. Pioneers and promoters of the collaborative economy were quick to point out the advantages, such as allegedly lower consumer prices, more social interaction, as well as environmental benefits through, for example, the better use of resources. However, to what extent are the claims about the environmental potential of the collaborative economy correct? To date, little rigorous research has been done on the true environmental impacts of the collaborative economy. Many studies use anecdotal evidence, or only take into account direct and indirect environmental impacts, excluding the rebound effects – i.e. the increased consumption due to a decrease in prices, and increased income earned and saved through engaging in the collaborative economy. This project, led by Trinomics, together with our consortium partners (VVA, Cambridge Econometrics and VITO), which focuses on transport, accommodation and consumer durables, is among the first studies to fill this knowledge gap and assist EU policy makers in defining appropriate (environmental) policy action in this rapidly developing field.

Key conclusions from this study:

The main conclusion of this study is that the environmental impacts at the individual transaction level are often lower in the collaborative economy compared to their ‘traditional economy’ counterparts. However, the net environmental benefits from this are likely to be partly or fully offset by increased consumption in other areas (‘the rebound effect’). Other important conclusions include:

  • Environmental impacts are very dependent on the type of collaborative business model studied, e.g. ride-sharing seems to have less environmental impact than carsharing, and room renting is more beneficial for the environment than renting out entire apartments;
  • The change in environmental impact depends strongly on the type of ‘traditional’ transaction it is compared to. For example, it makes a large difference whether a collaborative accommodation apartment is compared to a budget hotel or a high-end luxury hotel.
  • Transport:
    • Ride-sharing is generally the collaborative business model with the lowest environmental impacts.
    • At the macro-economic level, the largest environmental benefits occur because people engaging in carsharing tend to reduce their overall car use.
  • Accommodation:
    • The environmental impacts of renting a collaborative apartment are lower than that of staying in a midscale or luxury hotel.
    • However, at the economy-wide level, the reduced prices of holiday accommodation due to collaborative accommodation (e.g. Airbnb) might lead to increased travelling, resulting in increased environmental impacts.
  • Durable goods:
    • Sharing of durable goods reduces the environmental impacts compared to private ownership, especially for goods that consume energy during the use phase.
    • The positive environmental impact of goods sharing only applies when the distance travelled to exchange the product is short or when the means of transport is environment-friendly.