A shift away from mindless consumption

There has always been some degree of sharing by households and communities all across the globe of each others' good and bad fortunes, represented by facilities, amenities, services and goods, or the want of them.

This was most pronounced in countries, such as India and China, governed by the value-systems of age-old civilisations, which put a premium on sharing and caring. All for one and one for all was the ruling axiom, be it celebrating marriages and festive occasions, or lending a helping hand in times of family bereavements or large-scale calamities. However, unprecedented advances in technology, rapid economic growth and rise in income levels of the various strata of society soon led to conspicuous consumption or consumption as an end in itself, often degenerating into ostentation and greed. Increased mobility and scattering of members of previously close-knit societies all across the globe made for a self-centred, individualistic, consumerist culture, in which all distinctions between luxuries and necessities were lost.

Looking around, these trends seem to have played out. Astronomical prices have made real estate out of the reach of all but those in the billionaires' club.

House rents too have become similarly unaffordable, for even an upper-middle-class family, with decent earnings. It is not so much inflation, which can be viewed as a transient phenomenon brought under control with suitable measures.

Inflationary spiral, which can be unwound, should be distinguished from a worrisome scenario, in which the whole economy turns high cost, getting on to a relentlessly rising plateau, with little chance of easing up.

NEW RULES

This is the background in which some economic analysts have begun canvassing for a new pattern of ‘collaborative consumption' — a theme that has been elaborated in a book, What's Mine Is Yours: The Rise of Collaborative Consumption by Rachel Botsman, of which I came to know, from a reference to it in ‘Knowledge@ Wharton' website (August 25).

The quintessence of collaborative consumption is to evolve new rules of putting the assets and resources of average householders and economic players to optimum use by sharing, reusing, exchanging and monetising them, so that living within means without detriment to lifestyles and business plans becomes possible.

For instance, if there is a spare room or even a spare couch in the house, or if a car is idle for most part of the day, why not rent it out and get an income? It is win-win for both the person renting it out and the one to whom it is rented out, in view of the low transaction cost and the absence of hassles.

Without doubt, the new pattern is catching up fast with numerous start-ups already crowding the market for a variety of instances of rent-and-return such as allowing workers on the go to rent out workspace or a conference room for a day, or even for just 15 minutes; renting music rather than buy songs outright from services like iTunes; ordering meals from home makers or home cooks in the neighbourhood; and lending out, for a fee and on a short-term basis, photographic gear, medical equipment, computers, lawn-mowers and snowmobiles. There are, of course, risks such as damage or pilferage, but these are manageable.

On all accounts, new technologies and advances in smart-phones, GPS and social networks have facilitated the sharing and exchange of all kinds of assets in novel ways and on an unprecedented scale.

HERE TO STAY

“Collaborative consumption is not a niche trend but a new culture and economy. It is slowly becoming mainstream.”

Although the nomenclature may be new, many of the methods and practices constituting it are familiar ground for some decades.

Many companies and families nowadays choose to lease or rent cars or get the services of drivers on an hourly basis, instead of owning cars or employing regular drivers. Time sharing of homes for holidays, business centres, paying guest accommodation, and lending libraries/DVDs on call at one's doorstep, are all examples of the principle of shared consumption.

By whatever name it is called, it is here to stay.

COMMENT NOW