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March 16, 2018|agency costs, agents, Airbnb, chauffeurs, Ronald Coase, Sharing Economy, Uber

The Sharing Economy’s Online Agency Advances Material Equality

by John O. McGinnis|

Montri Nipitvittaya / Shutterstock.com
The dematerializing nature of the world can be a boon to the middling classes, and the sharing economy provides an example of this.

March 14, 2018|agency costs, Airbnb, Pillow Residential, Sharing Economy, Zoning

Regulatory Attacks on Airbnb Harm Efficiency and Equality

by John O. McGinnis|

ArthurStock / Shutterstock.com
Calls for stricter regulation on home rental companies like Airbnb are about protecting the hotel industry, not the consumer or communities.

November 23, 2017|Airbnb, banks, Bitcoin, information technology, letters of credit, ratings, Thanksgiving, Trust, Uber

Giving Thanks for Trust Old and New

by John O. McGinnis|

Thanksgiving is a time to reflect on trust and to be grateful for its presence in our lives.  Originally, Thanksgiving was a celebration of trust between two different peoples, the indigenous Indians and the Pilgrim settlers. Despite their different cultures and religions, they were able to trust one another enough to contribute food to a feast and sit down to dine with one another.

Today Thanksgiving is quintessentially a family celebration. At its best, it is suffused with trust because the family is a locus of trust.  Because of the bonds among kin, for most of human history much commerce took place among extended families. And most of the rest of it took place between people who were known to one another. Being a repeat player who must live in a community inspires trust in others, particularly past eras when being ostracized was very costly.

But as civilization developed, communities became larger and the opportunities for gains from trade extended beyond those that could be easily satisfied by family, new institutions had to arise to police trust.

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September 29, 2017|Airbnb, dead capital, Hernando de Soto, inequality, Lfyt, Sharing Economy, Spinster, Turo, Uber

How the Sharing Economy Helps the Middle Class by Enlivening Capital

by John O. McGinnis|

Many people, particularly on the left, argue that the modern economy is increasing inequality. But,  as I have discussed before, important trends in innovation increase equality.  One example of these equalizers is the sharing economy.   The ideas of a law and economics theorist of the developing world show how this new economy  generates a greater return on the assets that people of modest means are most likely to own.

Economist Hernando De Soto recognized that much of the capital in developing nations was locked up. For instance, squatters lacked property rights in their houses even after decades of living there and improving the land.  But legal reforms providing capital can greatly enliven previously dead capital in those nations. When a squatter becomes a property owner, he can mortgage his property and use the proceeds to start a small business.

The advantages of these legal reforms go almost entirely to people of modest means. Not only did the rich generally always have formal title to their real property, even more importantly real property is a much smaller proportion of their total assets, which are mostly financial securities.

Similarly, the sharing economy enlivens important capital assets in the developed world. As Daniel Rothschild suggests, this  unlocking creates prosperity.  But it also boosts equality because the assets it enlivens are those which make up most of the wealth of people of modest means.    

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February 22, 2015|Airbnb, Decentralization, Federalist Society, Lyft, Sharing Economy, Social Norms, Uber

Share–and Care–Alike

by John O. McGinnis|

In the sharing economy, companies like Uber, Lyft, and Airbnb, add value by using resources that would otherwise be idle.  The Internet connects people who need transportation or accommodations with people who are willing to provide them. Another substantial advantage is that these same connections permit social norms rather than government regulation to enforce standards of good conduct.

Government has a model for regulating taxis. It generally requires substantial licensing and enforces rules by tracking complaints and disciplining drivers found in violation. But a company like Uber makes much of this regulation unnecessary. First, given its substantial capital investment, it has every interest in checking out drivers itself before it permits them to represent its good name.

But Uber also makes use of social media to assure continuing good behavior of its drivers.

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Book Reviews

A Mirror of the 20th-Century Congress

by Joseph Postell

Wright undermined the very basis of his local popularity—the decentralized nature of the House—by supporting reforms that gave power to the party leaders.

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The Graces of Flannery O'Connor

by Henry T. Edmondson III

O'Connor's correspondence is a goldmine of piercing insight and startling reflections on everything from literature to philosophy to raising peacocks.

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Liberty Classics

Rereading Politica in the Post-Liberal Moment

by Glenn A. Moots

Althusius offers a rich constitutionalism that empowers persons to thrive alongside one another in deliberate communities.

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James Fenimore Cooper and the American Experiment

by Melissa Matthes

In The American Democrat, James Fenimore Cooper defended democracy against both mob rule and majority tyranny.

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Podcasts

Stuck With Decadence

A discussion with Ross Douthat

Ross Douthat discusses with Richard Reinsch his new book The Decadent Society.

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Can the Postmodern Natural Law Remedy Our Failing Humanism?

A discussion with Graham McAleer

Graham McAleer discusses how postmodern natural law can help us think more coherently about human beings and our actions.

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Did the Civil Rights Constitution Distort American Politics?

A discussion with Christopher Caldwell

Christopher Caldwell discusses his new book, The Age of Entitlement.

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America, Land of Deformed Institutions

A discussion with Yuval Levin

Yuval Levin pinpoints that American alienation and anger emerges from our weak political, social, and religious institutions.

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About

Law & Liberty’s focus is on the classical liberal tradition of law and political thought and how it shapes a society of free and responsible persons. This site brings together serious debate, commentary, essays, book reviews, interviews, and educational material in a commitment to the first principles of law in a free society. Law & Liberty considers a range of foundational and contemporary legal issues, legal philosophy, and pedagogy.

The opinions expressed on Law & Liberty are solely those of the contributors to the site and do not reflect the opinions of Liberty Fund.
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