The institutionalization of sharing economy platforms in China

Abstract

Recent past has witnessed a great proliferation of sharing economy platforms with great successes, but also many failures on their journey toward institutionalization, that is, their establishment and acceptance in society. To develop insight on factors contributing to this institutionalization process, this paper relies on the literature in institutional entrepreneurship and investigates sharing economy platforms in China, highlighting institutional voids that are encountered, and suggesting ways on how they can be overcome. These insights are derived through a multiple case study approach involving 61 semi-structured interviews with managers from eight sharing economy platforms (DiDi, Uber China, Huochebang, Yunmanman, OfO, Mobike, Evcard, and Zhida) across four sharing economy industries in China (ride-sharing, logistics-sharing, bike-sharing, and car-sharing). The findings highlight the importance of exchange and collaboration with stakeholders (allies) in the network, as well as the effective response to emerging issues through the adaptation of the business models. In addition, mergers and acquisitions, and the role of government are identified as critical components in aiding platforms in their progression toward institutionalization. Further cognitive, regulative, and normative factors are found to represent valuable institutional pillars that serve as a fertile foundation throughout the institutionalization process. Overall, the findings provide an intriguing insight into the journey of Chinese sharing economy platforms toward institutionalization.