MaRS Solutions Lab releases report on the sharing economy

In a new approach to policy-making, MaRS Solutions Lab convened stakeholders from across society to participate in designing regulations that create public value, support innovation and reduce administrative burden.

TORONTO, March 31, 2016 – In 2015, more than 375,000 people stayed in Airbnb accommodations while visiting Ontario. Today, Uber claims to have 15,000 driver-partners in Toronto alone. According to a new report produced by MaRS Solutions Lab, the rising popularity of the sharing economy is disrupting existing markets and forcing governments to rethink regulation. MaRS Solutions Lab applied a design-thinking perspective to gain a better understanding of the problem and to develop solutions for effective regulation.

The Sharing Economy Public Design Project engaged over 200 individuals and stakeholders, including taxi drivers, uberX drivers, hotel managers, Airbnb hosts and others subject to regulation. It also involved representatives from all three levels of government, industry, sharing economy companies (such as Uber and Airbnb), insurance companies, transit agencies and other experts. Through a series of workshops, these individuals helped to develop regulatory solutions that create public value, support innovation and reduce administrative burden.

“When it comes to introducing regulation for the sharing economy, governments should not only look at regulating new entrants, but should also revisit current regulations to reduce burden for existing operators,” said Joeri van den Steenhoven, the director of MaRS Solutions Lab. “Governments should not just think of the sharing economy as something to respond to. They should think about what kind of sharing economy they want and then develop a proactive strategy that helps build it.”

Over the past six months, the team developed its strategy with a particular focus on the accommodation and transportation industries.

The solutions for the accommodation industry include:

  • Defining home sharing: Only primary residences should be rented out and for a maximum of 180 days per year
  • Taxes: Tax obligations, thresholds and possible exemptions should be clearly defined and explained
  • Tourism promotion: The Destination Marketing Program should be either updated or revoked

The solutions for the transportation industry include:

  • Certifying drivers: Everyone should be vetted, but the process should be simplified
  • Training: Training should be redesigned to make it more effective
  • Insurance: Appropriate coverage should be developed for all drivers

The report defines the sharing economy as a paradigm of peer-to-peer lending that enables the sharing, borrowing or bartering of underutilized assets in exchange for goods, services or money. Technology plays a key role as it enables the creation of platforms and networks that can reach massive scale within a short period of time. This project was presented as part of the Ontario-Toronto Burden Reduction Working Group.

Read the report

About MaRS Discovery District
MaRS Discovery District (@MaRSDD) in Toronto is one of the world’s largest urban innovation hubs. MaRS supports promising young ventures that are tackling key societal challenges in the health, cleantech and information and communications technology sectors. In the last three years, these ventures have raised $1.3 billion in capital and earned $640 million in revenue. In addition to helping startups launch, grow and scale, the MaRS community is dedicated to cross-disciplinary collaboration, commercialization of discoveries and driving ideas to impact.

About MaRS Solutions Lab
MaRS Solutions Lab, based at MaRS Discovery District, helps to solve complex social challenges. It develops new approaches to addressing complex problems such as youth unemployment, obesity and mental health in schools. The lab brings together stakeholders from across society to help solve these problems collaboratively. It uses systems and design thinking, building on leading practices from similar innovation labs around the world. The lab also helps governments to modernize their policies and public services to keep pace with changes in society, and equips people and organizations with tools and techniques to create change.

For more information, contact:
Lara Torvi
MaRS Discovery District