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Everything written by Michel Bauwens

The sharing economy is a ploy for the commodification of everything

photo of Michel Bauwens

Michel Bauwens
31st August 2014

Some technology critics, with their laments of cultural decline enabled by Twitter and e-books, are partly to blame. Instead of engaging with attention and distraction socio-economically — as was done with earlier media by Walter Benjamin and Sigfried Kracauer — we get Nicholas Carr, with his embrace of neuroscience, or Douglas Rushkoff, with his biophysiological critique of acceleration (8). Whatever the salience of such interventions, they end up decoupling the technological from the economic, so that we end up debating how the screens of our iPads condition the cognition of our brains — instead of debating how the information gathered by our iPhones conditions the austerity measures of our governments. To be critical of technology today should mean questioning how it and its boosters let the current system buy more time, and stave off an even more existential crisis.

Excerpted from Evgeny Morozov:

“Several recent books — Social Physics by Sandy Pentland, Who Owns the Future by Jaron Lanier (1) — endorse this agenda. They promise the seemingly impossible — economic security and a future of privacy. If data is treated as property, strong property rights and modern enforcement technologies should ensure that no third party gets a free ride. Thanks to the Internet of Things and the proliferation of smart devices, our every act can be observed, and monetised: there’s someone, somewhere, willing to pay for knowing what song we whistle in the shower. The only reason it hasn’t happened yet is because our shower doesn’t have sensors and isn’t connected to the net.

The battle lines are clear. If Google fills our houses with smart thermostats like Nest, then Google will monetise our shower whistling. Google integrates data from different streams — self-driving cars, smart glasses, email — and its helpfulness is a function of its ubiquity. To get the best from it, we should let Google’s services fill in all the vacant areas of our digitised everyday existence. The size of Google’s data reservoirs makes competition unrealistic, a point not lost on smaller companies. The other option is to follow the populist calls of Pentland and Lanier and thwart Google’s ambitions by insisting that data automatically belongs to the users, or demanding that they at least share in Google’s profits.

Both of these positions, for all their apparent differences, belong to one political programme, representing two intellectual traditions. As the British sociologist Will Davies shows in his new book, The Limits of Neoliberalism (2), the future offered to us by Lanier and Pentland fits into the German “ordoliberal” tradition, which sees the preservation of market competition as a moral project, and treats all monopolies as dangerous. The Google approach fits better with the American school of neoliberalism that developed at the University of Chicago. Its adherents are mostly focused on efficiency and consumer welfare, not morality; and monopolies are never assumed to be evil just because they are monopolies — some might be socially beneficial.

For all its claims to innovation and disruption, the contemporary technology debate neither innovates nor disrupts: in assuming that information is a commodity, it operates firmly within a sole neoliberal paradigm.

While an alternative view of information would require grounding it in the non-economic realm — around the idea of the common, beloved by radical democrats, or something else — we might ask why the commodity status of information is accepted so uncritically. The current moment provides the answer: technology today is a deus ex machina, which can create jobs, stimulate the economy, and make up for taxes lost to the offshoring schemes of wealthy elites and corporations. Not to treat information as a commodity would mean closing the only untainted avenue open to policymakers.

This deus ex machina aspect of modern technology is poorly understood, even by perceptive observers of the financial crisis. In his 2013 book Buying Time (3), the German sociologist Wolfgang Streeck argues that, from the early 1970s, when the first signs showed of the impending collapse of the welfare model secured by the post-war compromise, western governments used tricks to buy more time and avoid overdue structural transformations: rampant inflation, public debt and, eventually, tacit encouragement of the private sector to provide cheap debt to households. The austerity agenda that followed was a moralistic response that punished ordinary citizens for sins they hadn’t committed.

Streeck does not mention information technology but its time-buying function is obvious. It produces new, entrepreneurial jobs — once everyone learns how to code and build their own apps — and unlocks immense economic value. The British government grasped this early on, embarking on ambitious, if controversial, schemes to sell patient data to insurance companies (popular protest forced a backtrack) and student admissions data to mobile operators and energy drink companies. A recent report on personal data and the British economy, supported in part by Vodafone (4), holds that more than £16.5bn could be made if it were easier for consumers to manage — sell — their personal data. The government’s task is to ensure that new data management intermediaries can legally insert themselves between consumers and service providers.

These government-led efforts to buy time from above are supplemented by efforts — mostly by Silicon Valley start-ups — to buy time from below. The hope is that services like Uber (for cars) and Airbnb (for apartments) can turn analogue assets into profitable services, supplementing their owners’ income. As Brian Chesky, CEO of Airbnb, puts it, “Now with record unemployment, massive income equality, we actually have this gold mine under our feet. It used to be [that] we lived in a world where people created their own content, but now we can now create our own jobs and maybe even our own industries” (5). Indeed.

Silicon Valley, always quick to capitalise on counterculture, appropriated the communal gift-oriented rhetoric of earlier efforts to transcend the neoliberal agenda, presenting start-ups like Uber and Airbnb as part of the “sharing economy” — the utopian future beloved by anarchists and libertarians, where individuals can deal with each other directly, bypassing large intermediaries. What we are witnessing, however, is the replacement of service intermediaries, like taxi companies, with information intermediaries like Uber — which is backed by those admirers of anarchy, Goldman Sachs.

Since established taxi and hotel industries are detested, the public debate has been framed as a brave innovator taking on sluggish, monopolistic incumbents. Such skewed presentation, while not inaccurate in all cases, glosses over the fact that the start-ups of the “sharing economy” operate on the pre-welfare model: social protections for workers are minimal, they have to take on risks previously assumed by their employers, and there are almost no possibilities for collective bargaining.

The proponents of the “sharing economy” justify such precariousness with rhetoric worthy of Friedrich Hayek: once we replace laws with feedback mechanisms — so the market attests to the quality of the driver or the host — we can dispense with pre-emptive regulation. As Fred Wilson, a prominent venture capitalist, put it recently, “when we reach a place where systems are truly self-governing and self-regulating, we will not need regulators” (6). Ubiquitous feedback loops — in reality, just quality signals provided by market participants — would get us there.

The digitisation of everyday life and the rapaciousness of financialisation risk turning everything — genome to bedroom — into a productive asset. As Esther Dyson, a board member of 23andme, the leader in personalised genomics, said the company is “like the ATM that gives you access to the wealth locked within your genes” (7). This is the future that Silicon Valley expects us to embrace: given enough sensors and net connections, our entire life becomes a giant ATM. Those refusing this would have only themselves to blame. Opting out from the “sharing economy” would come to be seen as economic sabotage and wasteful squandering of precious resources that could accelerate growth. Eventually, the refusal to “share” becomes tinged with as much guilt as the refusal to save or work or pay debts, with a veneer of morality covering up — once again — exploitation.

It’s only natural that the less fortunate, under the burden of austerity, are turning their kitchens into restaurants, their cars into taxis, and their personal data into financial assets. What else can they do? For Silicon Valley, this is a triumph of entrepreneurship — a spontaneous technological development, unrelated to the financial crisis. But it is only as entrepreneurial as those who are driven — by the need to pay rent — into prostitution or selling their body parts. Governments might resist this tide but they have budgets to balance: Uber and Airbnb will eventually be allowed to exploit this “gold mine” as they please, boosting tax revenues and helping citizens make ends meet.

The “sharing economy” won’t supplant the debt economy; they will coexist.”


Posted in Cognitive Capitalism, P2P Technology, P2P Theory | No Comments »

Video: Jim Zemlin on the Importance of Foundations for Collaborative Technological Development and Economics

photo of Michel Bauwens

Michel Bauwens
29th August 2014

Jim Zemlin gave an excellent talk about the importance of foundations in facilitating collaborative development at the 2014 State of Linux conference. He focuses on the key role of FLOSS Foundations, such as the Linux Foundation, and their key role in facilitating open production.

His main points:

* A neutral home for collection and sharing of resources.

* Enable structured investment.

* Helping industry understand how to engage with the community.

* Shared legal defense.

* Shared development infrastructure.

* A neutral home for key developers.

* Addressing market failures.

* Raising awareness (marketing) to bring in more developers and users.

* Organize events for face to face meetings and training.

* Provide training and certification to help grow the community.

Watch the video here via


Posted in Conferences, P2P Collaboration, P2P Governance, P2P Infrastructures, P2P Technology, P2P Theory, Peer Production, Videos | No Comments »

How Algorithmic Scheduling is complicating working lives and the parenting of the poor

photo of Michel Bauwens

Michel Bauwens
28th August 2014

Excerpted from the NYT:

(worth reading the detailed working life profiles in detail)

“Like increasing numbers of low-income mothers and fathers, Ms. Navarro is at the center of a new collision that pits sophisticated workplace technology against some fundamental requirements of parenting, with particularly harsh consequences for poor single mothers. Along with virtually every major retail and restaurant chain, Starbucks relies on software that choreographs workers in precise, intricate ballets, using sales patterns and other data to determine which of its 130,000 baristas are needed in its thousands of locations and exactly when. Big-box retailers or mall clothing chains are now capable of bringing in more hands in anticipation of a delivery truck pulling in or the weather changing, and sending workers home when real-time analyses show sales are slowing. Managers are often compensated based on the efficiency of their staffing. Scheduling is now a powerful tool to bolster profits, allowing businesses to cut labor costs with a few keystrokes. “It’s like magic,” said Charles DeWitt, vice president for business development at Kronos, which supplies the software for Starbucks and many other chains.

Yet those advances are injecting turbulence into parents’ routines and personal relationships, undermining efforts to expand preschool access, driving some mothers out of the work force and redistributing some of the uncertainty of doing business from corporations to families, say parents, child care providers and policy experts.

In Brooklyn, Sandianna Irvine often works “on call” hours at Ashley Stewart, a plus-size clothing store, rushing to make arrangements for her 5-year-old daughter if the store needs her. Before Martha Cadenas was promoted to manager at a Walmart in Apple Valley, Minn., she had to work any time the store needed; her mother “ended up having to move in with me,” she said, because of the unpredictable hours. Maria Trisler is often dismissed early from her shifts at a McDonald’s in Peoria, Ill., when the computers say sales are slow. The same sometimes happens to Ms. Navarro at Starbucks.”


Posted in P2P Labor, P2P Rights, P2P Technology | 1 Comment »

Why unions are necessary in the on-demand, so-called, ‘sharing’ economy

photo of Michel Bauwens

Michel Bauwens
25th August 2014

the workers themselves need to have a say in how this new world develops. The idea that a handful of platforms operating on razor-thin margins will create an equitable world for their workers — that algorithms written by the employers will protect workers’ rights better than the workers themselves and their elected representatives could — would be funny if the reality of this model weren’t so outright terrifying.

Excerpted from David Meyer:

“Creating a better workplace is a big part of the purpose (of unions), but so – fundamentally – is the ability of workers to organize themselves so they can speak with a collective voice. And the purpose of that is to counterbalance the voice of management or the providers of capital, in order to preserve their rights. It’s about maintaining healthy power dynamics.

There is no such opportunity for workers in the on-demand economy — no platform for organization, no collective voice, and no power. Sure, if individual workers don’t like the work then they can theoretically leave, but they can and will be replaced immediately. That’s the whole point of the on-demand economy – it’s taking full advantage of the fact that the supply of workers greatly outstrips demand. And that means that the departures of individuals will provide little incentive to on-demand employers to improve wages and working conditions.

A piece of a job is better than no job at all, but it doesn’t give you security and predictability. Want to talk about employment and health? Crichton’s big citation is the Whitehall II study, which examined how social position can affect health. The big takeaway from this study is that the poorer you are, the likelier you are to get sick. In Crichton’s hands, the study proved that “workplace flexibility can literally extend a worker’s life expectancy.”

If you’re talking flexibility in working hours, then sure, that’s definitely healthier, as Whitehall II and many other studies have established. But if by flexibility you mean uncertainty, then you’ll find an altogether different story. Indeed, studies have generally found that “flexible employment” is as bad for health as unemployment is, with the model’s inherent insecurity causing chronic anxiety and raising self-reported morbidity.

Sure, they can refuse to be picked up, as long as they’re happy to starve.

Flexibility is not necessarily control. Sitting there waiting for a task to roll in, on take-it-or-leave it terms, is not an empowering experience. Many people would genuinely prefer “the corporate grind of the past, with employees sitting in soulless cubicles and waiting thirty years to retire,” as Crichton put it, if that’s the alternative.

I’m from South Africa, where you regularly see people sitting by the side of the road, waiting for someone to pick them up and take them to go weed someone’s garden or lay a few bricks. These hopeful workers represent the ultimate commoditization of labor, a never-ending supply with no meaningful differentiation and no bargaining ability. Sure, they can refuse to be picked up, as long as they’re happy to starve. If they have any control through their “flexibility”, it’s of a pretty meaningless variety.

The fact is, it is possible to combine flexible working practices with full-time or long-term part-time employment. Thanks to the internet, we don’t all need to be behind our desks at fixed hours of the day. Sure, we’re not talking complete flexibility – timing still matters to a great extent – but nor, in many cases, are we talking old-school clocking in and out.

Some people don’t even like this kind of flexibility, when it means always being on-call. Witness the policies adopted by many German companies, which block after-hours email in order to prevent worker burnout. Who asked for that? The unions.

What some people seem to forget about unions is that they’re comprised of workers. Yes, unions can become powerful entities in themselves (which is, again, the point), but they ultimately push for what workers want. In a healthy working environment, the terms are thrashed out by mutual consent between the employers and the employees. Solidarity is key, but even when some workers don’t choose to join a union, they’ll often still benefit from the results if their colleagues do.

I get that Crichton isn’t calling for permanent instability in employment. As he wrote, “the market has to be built in such a way that stability is a possible outcome for those who seek it.” But it’s a tad naive to think that this stability will come from the startups building the platforms in question. They simply have no interest in doing so, and won’t until the demand for labor outstrips the supply.

Look at Uber, which strenuously denies that its drivers are its workers at all, which won’t guarantee to pay those drivers’ fines if they’re caught keeping Uber’s business afloat in cities where the service is banned, and which ultimately wants to get rid of those drivers altogether. TaskRabbit now matches tasks to workers by algorithm rather than letting workers bid for them, erasing much of the control its workers had over their work situation. These are the kinds of businesses that are going to be the “champions of workers”?

I have absolutely no doubt that the workplace of the future will look very different to that of today, and perhaps entirely different to that of a few decades ago. There will probably be fewer jobs to go around, and in many cases we will certainly need to adjust our conceptions of the workplace and the working week. A lot of people like the traditional setup because they care more about what happens after 5pm than the drudgery that comes before, and maybe they’re going to be out of luck.

However, the workers themselves need to have a say in how this new world develops. The idea that a handful of platforms operating on razor-thin margins will create an equitable world for their workers — that algorithms written by the employers will protect workers’ rights better than the workers themselves and their elected representatives could — would be funny if the reality of this model weren’t so outright terrifying.

Ultimately, if work is to truly benefit the worker, she needs to have a voice and real clout. Maybe the traditional union model and traditional labor laws won’t provide that, but the underlying goals of that model and those laws — to make sure employers can’t exploit employees — must be central to this brave new world of work. We just need new ways of achieving this, not to stop trying.”


Posted in P2P Labor, Sharing | 1 Comment »

How market-based incentives erode the effectiveness of reputation systems

photo of Michel Bauwens

Michel Bauwens
24th August 2014

Market-based incentives erode the effectiveness of reputation, and in this respect reputation is a cultural commons. In her TED talk, influential author Rachel Botsman says that in the new economy “reputation will be your most valuable asset”, but as reputation becomes an important asset, markets will grow around it and intermediaries will claim to help you boost your reputation, but these market-based incentives destroy the value of reputation as a mechanism for establishing trust. Mechanisms for buying and selling testimonies, for example, cause testimonies to lose their ability to discriminate between trustworthiness and opportunism because an opportunist with money could buy themselves a good reputation.”

Excerpted from Tom Slee:

“BlaBlaCar, a French sharing economy company that connects “drivers with people travelling the same way” throughout Europe, has over a million registered drivers, transports over half a million passengers every month, and is expanding rapidly. Also, it makes testimonial-based ratings available on its web site.

Of 190129 distinct ratings, 2152 were one-star, there was not a single two-star rating, there was one three-star rating, five four-star ratings, and 187971 five-star ratings. A BlaBlaCar rating means something different from a Netflix movie rating.

With over 98% of ratings being five stars, the reputation system does not meaningfully discriminate among drivers or riders. A reputation system that does not discriminate fails as a reputation system: it fails to solve the problem of trust.

Collusion and fear of retaliation are the reasons why there are essentially no reviews less than five stars for rides that take place. If you give a less-than-five star review then, unlike in the case of offline community-based testimonials, it is visible to the reviewee, who can give you a harsh review in return and so affect your chance of getting future rides. Do you want to defend your opinion that the driver was a bit close to the car in front, or that the car was a bit dirty, or do you just want to give a five-star review and make a note to yourself not to ride with them again? Collusion is the other side of the retaliation coin: I know I turned up late and was eating smelly food in your car and you didn’t like it, but so long as you give me five stars I’ll give you a good positive rating and we’re both better off. Neither of these factors need to be explicit or even to be very important to produce large effects, because it makes no difference to me how I rate you. One seemingly tiny difference between word-of-mouth and the internet rating system makes all the difference, that testimonials are visible to everyone including the reviewee instead of everyone except the reviewee.

The problem is not unique to BlaBlaCar. Reciprocity and collusion in the eBay reputation system has been studied here and the authors also provide an estimate of how many dissatisfied people are not rating their trustee:

The fact that from 742,829 eBay users… who received at least one feedback, 67% have a percentage positive of 100%, and 80.5% have a percentage positive of greater than 99%, provides suggestive support for the bias. The observation is in line with Dellarocas and Wood (2008) who examine the information hidden in the cases where feedback is not given. They estimate, under some auxiliary assumptions, that buyers are at least mildly dissatisfied in about 21% of all eBay transactions, far higher than the levels suggested by the reported feedback. They argue that many buyers do not submit feedback at all because of the potential risk of retaliation.

Finally, on Airbnb, reviewing of hosts by guests and guests by hosts also happens in public and is reciprocal. The Airbnb web site does not display individual numerical reviews, although it does display individual text reviews; instead it displays the average rating that a room has received in each of several categories (cleanliness, location, communication,…) together with an overall average, rounded off to the nearest 0.5 out of five. The web site is less easy to traverse programatically, but out of well over a hundred offerings in New York, Sydney, Berlin and Paris I have yet to see a single one that is not rated 4.5 or 5.6

So even in the absence of explicit gaming, peer-to-peer internet reputation systems do not solve the problem of trust. The BlaBlaCar site fails the basic test of discriminating among almost any of the 190,000 drives that took place—it fails to deliver any useful information beyond giving the occasional sign that a driver or rider may not turn up.”

* The commercial sharing economy is abandoning its reliance on peer trust systems

“Venture capital demands for scale will produce changes in the nature of the sharing economy sites, changes that erode any community focus they have, and which turn them into far more traditional models. Such changes are already underway at the largest, most heavily funded sites.

As Gannes reports, a single bad incident has forced Airbnb to hire a 50-person “trust and safety team” headed by a former US Army intelligence office and a former government investigator. The use of a human team clearly doesn’t scale, so Airbnb is now turning to centralized analysis to solve its problems, saying “We want to apply data to every decision. We want to be a very data-driven company.” On April 30 2013, asserting that “Trust is the key to our community”, Airbnb introduced a “Verified ID program” which demands that you provide government-verified identification and permit the company to analyze your social networking presence or provide it with a video profile.

There is also a drive for more professionalism among hosts. Airbnb now lets hosts sell tours and activities, and here is Chip Conley, the new “Head of Global Hospitality” for Airbnb, hired from the hotel industry, in a September 2013 interview:

We’ll be introducing nine minimum standards around what we expect an Airbnb experience to be, whether it’s related to cleanliness or the basic amenities you expect, which is not currently the case. The idea that we create some amenities that you should expect—clean towels, clean sheets—that’s important. In short, Airbnb is abandoning the idea that peer-to-peer reputation systems can solve the problem of trust, is moving away from the casual “air bed” mentality that gave it its name, and is resorting to traditional centralized systems of enforced minimum standards, documentary verification, and so on.

There is, however, one remaining difference between Airbnb and a traditional hospitality business. To go back to the beginning of this essay, sharing economy companies claim that it is both necessary and sufficient to solve problems of trust and coordination to unlock a large new economy of resource sharing. The “sufficient” part of this is valid only if there are no spill-over effects from the operations of the sharing economy, so sharing economies will campaign for freedom from those constraints that prevent them maximizing their returns: health and safety standards, employment standards, licensing laws, and so on.

To be successful, the venture-capital-funded “sharing economy” will be forced to lose all those aspects of informal sharing that makes “sharing” attractive, and to keep those aspects that erode neighbourhoods, erode employment rights, and remove basic standards. And if they succeed, they will have used the language of sharing to bring about an unregulated, free-market, neoliberal economy.


Posted in Economy and Business, Sharing | No Comments »

In Montreal: an appeal for the taxation of AirBNB and the sharing economy

photo of Michel Bauwens

Michel Bauwens
23rd August 2014

Excerpted from an editorial in Montreal’s The Gazette:

“Airbnb is an efficient and popular pillar of the burgeoning sharing economy.

Whether the hotel industry likes it or not, San Francisco-based Airbnb, with a market valuation of $10 billion, is here to stay. And so, whether Airbnb and its fans like it or not, this is why it has become all the more urgent to address some related social, fiscal and legal challenges.

Those include figuring out how to track rental income earned through Airbnb, for tax purposes; raising public awareness that tenants who sublet their dwellings without the consent of their landlords are violating the rules in their leases; and making sure people know there are insurance complications when it comes to liability for property damages that may arise.

Perhaps the biggest issue, for the general taxpayer, is that Airbnb in Quebec does not currently collect any of the room or sales taxes that traditional hotels charge. It should.

The way things work now, the onus of tax compliance is on the hosts who rent out space. Currently, Airbnb advises hosts of their responsibilities, but it doesn’t do anything more than that. And so Airbnb commercial transactions aren’t automatically generating the tax revenue they should, in the same way as commercial hotel and B&B stays. Tourism Quebec understandably conducted an inspection-and-fine blitz of Airbnb operators last year, as a prelude to negotiations this summer with the company to clarify its legal and fiscal obligations.

All Airbnb operations, like hotels and B&Bs, should be responsible for collecting and remitting sales and hotel taxes to governments. Portland, Ore., recently bargained hard for such an arrangement with the company. There’s no reason why Montreal and Quebec should settle for any anything less.

Nor should any other city or state. San Francisco and other foreign destinations are also negotiating hotel-tax agreements and other fiscal arrangements. New York and Paris, meanwhile, are dealing with a shortage of affordable housing exacerbated by the growing trend of landlords transforming rental units into lucrative de-facto hotel rooms, many of them linked to Airbnb.

The sharing economy — be it for room accommodation or taxi rides — is a game-changer that should not be wished, fined or legislated out of existence. But it must not be left to operate in black-market conditions.

To its credit, Airbnb has shown it is open to addressing some of the challenges that have arisen. Just because innovations that disrupt and revolutionize establishment commerce are popular, cool and convenient for consumers doesn’t mean they should sidestep taxation responsibilities. Bringing these newcomers into the regulatory fold isn’t about strangling them with bureaucratic red tape or stifling innovation. It’s about encouraging the sharing economy to share a percentage of its economic activity with the public purse, as all for-profit commercial enterprises are supposed to do.”


Posted in Economy and Business, P2P Public Policy, Sharing | No Comments »

Video: a short intro to the ‘moneyless’ Trade Schools in London and New York

photo of Michel Bauwens

Michel Bauwens
23rd August 2014

The Collaborative Cities project interviews co-founder Caroline Woolard and attends a class in London (Hub Westminster).

Trade Schools are ‘barter for education’ communities.

Watch the video here:


Posted in P2P Education, Sharing, Videos | No Comments »

Online Employment Agencies and the Casualization of the Workforce

photo of Michel Bauwens

Michel Bauwens
22nd August 2014

Excerpted from Veronica Sheen (Australia):

“The online agencies extend what is already on offer by contracting and labour-hire companies, as well as self-employed contractors such as office temps, cleaners, IT specialists, gardeners, labourers, or tradespeople. But in the new model the middle-man (the contracting company) is eliminated – notwithstanding the cut that the online agency takes for itself out of the payment to the worker.

The type of work offered by online employment agencies extends the “casualisation” of the workforce accounting now for around 20 per cent of Australian employees. This casualisation is increasingly part of ongoing employment arrangements for many businesses. The “helper” employed through an online agency is in effect another “casualised” worker.

But unlike other types of contracted and casual employment, these employment relationships fall outside any labour regulatory framework as provided through the Fair Work Act. This means they do not conform to minimum wage or health and safety requirements or provide for any other entitlements. While this is not dissimilar to the situation of any self-employed contractor, its desirability depends on whether the workers have a real choice in regards to this kind of employment and are able to negotiate satisfactory pay and conditions.

On the Airtasker website, a job to clean an apartment involving a couple of hours work offers $US40. Airtasker charges 15 per cent commission for the job so the total payment the worker received – $US34. At the time of my perusing, on the Ozlance website someone is looking for a web developer which has attracted 27 quotes ranging from $250 to $2000.

These bidding arrangements for jobs may encourage undercutting of wages across the board. While the agencies themselves insist that quality – as monitored through an online review process – is also an important component of the bidding and pricing process, it is hard to see that this will outweigh price for most contracts, especially where quality factors are similar. Much online work can also be outsourced to low-wage countries as we can see on the Freelancer Australian website, where people are offering their services for as low as $US6 and $US7 per hour.

Sidekicker runs a different model with a set minimum fee of $29 per hour but deducts 20 per cent for itself so the worker will end with $23 per hour – maybe not so bad depending on what the job involves.

The online employment agencies promote the freedom and opportunity of freelancing work, but I wonder how many people find this type of work greatly congenial and rewarding over the long term. One IT commentator suggests the returns to workers are low and that many people signed up for Airtasker get very little, if any, work at all.

The type of employment arrangement from the online agencies recalls some of the disturbing employment trends in the United States as portrayed in a Foreign Correspondent program and in other articles. The essence of these stories is that the post-GFC recovery in employment in the USA is quite weak with many people forced into part-time, low-wage and casual employment because there are so few decent jobs being generated. Nobel laureate Joseph Stiglitz believes this trend is consolidating inequality and also holding back the recovery.

In the Foreign Correspondent documentary, a young woman is employed in a bar with a nominal wage of $US2.13 per hour and relies on gratuities to make a living. What kind of employment arrangement is this? In fact, it is an employment relationship that the online agencies also propagate.

The individual worker comes into the “labour” market unfettered by any requirements, regulations or rights in relation to wages and conditions – simply what she can obtain on the day for her labour in a marketplace much as a farmer would auction a sheep or a box of oranges.

Should we be worried about this trend in online employment agencies then? It depends. In an economy and labour market with plentiful opportunity for decent work, it is really of no account and may suit some workers and some employers. But where opportunity for decent work is eroded as reports from the United States suggest, then the proliferation of unregulated employment arrangements is concerning in that it exacerbates inequality and dampens economic growth as Stiglitz argues.”


Posted in P2P Labor | No Comments »

Video: Wallerstein vs. Rifkin, against the zero marginal cost thesis ?

photo of Michel Bauwens

Michel Bauwens
22nd August 2014

Well not really, though the title points to one possible way to interpret this interview with Immanuel Wallerstein.

Wallterstein argues that historically, despite oscillations, the price of inputs in labor, material/energy and taxation, have gone up, leading to a systemic crisis for capital.

Rifkin, in his last book, makes a different hypothetis, but focusing on the output. Even giving rising input costs, there is a revolution in output, that with one initial input, it is now possible to produce ever more output, reaching a level that is also problematic for the accumulation of capital.

I strongly recommend watching the video in full.

Watch the video here:


Posted in Cognitive Capitalism, Economy and Business, P2P Theory, Videos | No Comments »

Video: a short intro the Aikapankki Timebank in Helsinki

photo of Michel Bauwens

Michel Bauwens
21st August 2014

The Collaborative Cities project interviews Ruby Van der Wekken and colleague Piia on the experiences of the Helsinki Time Bank, one of the most elaborate projects of this type in Europe:

Watch the video here:


Posted in P2P Money, Videos | No Comments »