Last Thursday night I had the pleasure of meeting Professor Michael Munger, as we drove to the lecture he was due to present at. The lecture focused on the revolution of the Sharing Economy with the ILS co-hosting his talk, entitled ‘Tomorrow 3.0’, with the University of Carleton’s Economic Society. Professor Munger argued there had been two enormous revolutions in human history so far, the Neolithic revolution and the Industrial revolution. The third, he argued, would be the Sharing Revolution. He talked about how the emergence of services such as Uber, AirBnb and something called Part Time Pooch, allowed many people to share one product rather than buying a car, apartment or pet individually. He argued that over time this will greatly reduce the number of goods we need to buy ourselves, and the amount of space we will need to store those goods.
The services that facilitate this sharing, such as Uber, will lead this revolution by selling reductions in transaction costs. This means Uber makes it way easier for you and your Uber driver to find each other and engage in a mutually beneficial exchange than if that service didn’t exist. Can you imagine waving a cardboard sign around in the streets of Perth with your desired location and suggested fee until a car drives by that likes your offer? With Uber, that effort greatly reduces to just a few taps on our phone. Now we can engage in a mutually beneficial exchange that we otherwise wouldn’t have – that’s the power of reductions in transactions costs.
Apart from my own independent evaluation that the lecture was incredible, the free pizza ran out within five minutes and the lecture theatre was packed to capacity – I’d call that a success.
Luckily for me, I would also be spending the next three days with Professor Munger as he would be leading the discussion at the Socratic Seminar on Civil Society, Mutual Aid and the Welfare State that we were hosting in our office this weekend. For those who are unaware, Socratic Seminars are a special format of discussion that encourages a group conclusion to be made about particular issues through the input of the student’s own opinions, rather than those of the discussion leader. The ILS believe that people learn best when they are active participants in a discussion among peers.
Our group of eleven eager students engaged in discussions based on our assigned 200 page prior readings, involving topics ranging from the morality of the welfare state to the character of the poor. One particularly contentious topic was whether we should introduce a Universal Basic Income, which involves the replacement of most of the current welfare system with an equal and unconditional sum of money that is paid out annually to all residents of a nation, regardless of their current income. The argument for this initiative revolved around reducing the disincentive to work at the margin between receiving welfare and not receiving welfare that currently exists in a means tested system, as well as providing the poor with more autonomy with how they manage their finances.
I wish I could relay all the incredibly stimulating conversations that we had during the seminar this weekend, but I shall instead conclude that it was an incredibly valuable learning experience that I will not quickly forget.