newswire: 6/4/2020
- With issues like sanitation and flexible booking top of mind, hotels may now have an edge over home-sharing services like Airbnb. While the entire travel industry is suffering, Airbnb is likely to have a harder time convincing customers that their offerings are virus-free. (The New York Times)
- NH: In the age of social distancing, sharing is not caring. While the pre-COVID world was all about crowdsourcing and carefree togetherness, the new marketplace will look much different. And the sharing economy will be especially hit hard by coronavirus.
- To begin with, our world will become more formal. With Airbnb, we causally slept in strangers' homes. But now that we are obsessed with cleanliness, the formal hotel, where the staff is paid to wear masks and do deep cleanings, becomes more attractive. Or think of WeWork where different startups all casually worked in the same space. Forget about "hoteling" your workspace. Something similar may appear with premium limos and taxis: Rather than take an Uber, many people may prefer a more formal contract with a more regulated carrier.
- People are also going to become more self sufficient. We're all familiar with the so-called "blow-dryer economy" (I'll pay you to do my hair and you pay me to do yours). That sort of redundant marketplace complexity has exploded since the 1980s--and has contributed hugely to accelerated GDP growth. From preparing our meals to raising our kids to exercising our bodies, we weren't actually doing any more of it. We were all simply paying each other to do it.
- As Americans congregate into autarkic family "bubbles," we're no longer paying each other for all these services. We're acting more like real households again. (Reminder: the very word "economy" comes from the ancient Greek word for household, a place where substantial production was supposed to take place.) This contraction in the scope of marketplace activity has parallels to the 1930s. IMO, it will be one of the most profound and durable consequences of the pandemic recession.
