Sustainability of generalized exchange in the sharing economy: The case of the "freecycling" facebook groups

Abstract

The growth of the sharing economy has attracted a lot of attention in recent years. These online platforms bring together individuals willing to share and those who are in need. While sharing in some of these platforms is reciprocated by money or reputation, some platforms rely heavily on individuals' good will to give their things away with no personal benefit. Why do individuals cooperate in environments where there is every incentive to free-ride instead? In this article, we examine several explanations for such peculiar behavior – namely, the hypothesis that prosocial or sharing behavior spreads from person to person, and social learning hypothesis, which tells that such behavior could be based on mimicking others. We test these hypotheses using longitudinal data from a freecycling group on Facebook with 4818 members. The group is made for people to give things away for free, thus making the group vulnerable to free-riding behavior. We find that individuals who are more active receivers are also more likely to share something with group members in the future. We also find some evidence of a positive effect of social learning on sharing behavior.