Redundancy in the sharing economy

The success of the sharing economy in China has attracted worldwide attention. Alongside the standard model of the customer-to-customer sharing of idle/superfluous resources, the new model of business-to-customer sharing of new resources has been gradually thriving. However, beside the advantages, there are some drawbacks, such as system redundancy, which have so far been ignored. This paper addresses the problem of redundancy in the sharing economy. To do so, we have built a theoretical model indicating the determinants of redundancy, which are mainly affected by the market structure, multi-homing, competitive strategy, public cost, and externality. Furthermore, we support these results by analyzing two of the biggest companies in the sharing-bike sector in China: Mobike and OfO. This paper helps practitioners and the government to better understand the inherent economic logic of redundancy, so that they can harness and regulate the sharing economy more effectively.