Posted by Social Science Research Network
By Michael C. I. Nwogugu
Abstract: During the last fifteen years, the “Sharing Economy” (which includes Airbnb; Apple; Alibaba, Uber; Lyft; Ebay; Didi Chuxing; HomeAway, etc.) has blossomed across the world, triggered structural changes in industries and significantly affected international capital flows primarily by disobeying laws in many countries and illegally reducing and changing the nature of competition in many industries often to the detriment of social welfare. The myriad of regulations that ―Sharing Economy Organizations‖ (SEOs) violated globally include health, fire-protection, housing, zoning, hotel, tax, securities, taxi/transportation, antitrust and consumer protection statutes.
SEOs also create significant Network Effects that illegally entrench them industries. In spite of these issues, large and prominent institutional investors have made significant investments in SEOs; and they may have indirectly or directly influenced the surprisingly slow and relatively very limited regulatory responses to SEOs in many countries. Some persons have filed lawsuits against SEOs and some cities/states have enacted new regulations to curb SEOs‘ illegal activities. This article reviews issues pertaining to international capital flows and structural changes that were caused or facilitated by SEOs; and develops viable theories-of-liability for claims against SEOs and government agencies that condone or support them.