We do need to learn the lessons of previous arrangements in order to prevent ourselves making the same mistakes again. So it is with this sharing economy lark.
What Uber revealed to us was who was really benefiting from the previous taxi licencing regime. In New York the licence to run a cab could be rented out for some $80,000 a year. That gave such a licence a capital value of some $1 million. This is pure rentierism, the extraction of an economic rent simply for owning the right government issued piece of paper.
The irruption of Uber into the market has brought down that rent, the licences are now worth perhaps some one tenth of that peak sum. Good.
Now, consider that lesson as we look at Airbnb:
In extreme cases such as Barcelona, the only answer might be a clampdown. (It would certainly help if Airbnb could be bothered to pay the €600,000 finethe city levied on it in 2016.) In other places, a more nuanced approach might be appropriate. Many cities now put a cap on how many nights per year a property can be rented short-term and it may be a good idea, too, to cap the number of properties a single owner can list, or limit the number of permits enabling owners to list property in a particular area. The lesson should be that no company is above the law.
We must, as previously with the cabs, limit the number of suppliers to the market. By law, with licences. The effect of this?
In Barcelona, it used to cost €250 (£221) for a short-term rental permit. Now that such permits are no longer being issued, they change hands for up to €80,000. It’s “sharing” for the rich, maybe, but not for the rest of us.
Our correspondent (in The Guardian, of course) complains about the creation of pure economic rents then demands that more be created? Do these people even read their own articles?
Why would we want to create capital value, incomes, for those who just happened to be in the right place when the pieces of paper were handed out? It’s an absurd ignorance of the market effects of restrictive regulation, isn’t it.