In the past two centuries, the slowdown in U.S. productivity growth of physical capital may have correlation with capital impact of digital goods in the era of digital revolution, which give rises to sharing economy. The old capitalism economy has produced inequality because the returns on capital are persistently higher than the overall rate of growth in the economy. Some assets were left idle, under-utilised, unproductive asset and wealth are kept in the offshore accounts. Sharing economy encourages wealth to be shared with unknown crowd with less complexity.

Airbnb is an internet platform service providing efficient short-term accommodation holiday or short rentals for all prices. The company makes money from the three percent host-booking fee and processing fees from the customers. The platform started by three young designer graduates from RISD living in Rhodes Island, who started with a noble mission of sharing air mattress with conference participants who couldnt get the hotel accommodation nearby the conference venue. The three founders went to Silicon Valley to pitch the idea for capital injection after they have launched the activity for a couple years. The philosophy of Airbnb according to the founders. Core values of Airbnb belong everywhere. Airbnb tapped into something greater than low prices and an abundance of available inventory. It offered an experience that was special and different from the regular hotel experiences.

Today, Airbnb performance has reached 140 million guests arrivals since its inception, 3 million listings in 191 countries and 34,000 cities, except Iran, Syria and North Korea. The main users travel using Airbnb are millennials who find it affordable and adventurous. Travelers can stay in peoples home in neighborhood off the conventional tourism grid, connecting with like-minded souls, for much less than the cost of a hotel. Millennials, have exhibited a growing dissatisfaction with big brands and love to be more artisanal and want to have experience that felt more local when travelling.

Airbnb expands and grows organically, low-cost, fast and efficiently structured. Airbnb only spent USD300 million of the roughly USD3 billion in equity funding it has raised. The activity under sharing economy includes acquiring, providing, sharing access to goods and services facilitated by on-line platform, thanks to the advent of the Internat of Thing (IoT) and digital economy which has made it easier for asset owners and those seeking to use those assets.

Airbnb business is fundamentally about leveraging a global network effect: the more people who list on Airbnb, the more inherently attractive the platform becomes to anyone who wants to travel. Airbnb produce fast and cheap pollination effect: when a traveler from France uses Airbnb in New York, he or she is more likely to go back to France and consider hosting, or to share experience with friends, sparking awareness and ultimately leading to more listing activity in that market.

The Airbnb had generated market value with less government play their roles. Hosts had earned more than USD3.2 billion over the previous seven years. In New York alone, Airbnb reported that its business brought in USD1.15 billion in economic activity in 2014- USD301 million of which went to hosts and USD844 million to New York City businesses and neighborhood that dont typically see tourism dollars.

The sharing economy allows many people to make extra money which for some of us could be a lifeline. As a result, it increases the supply of goods and services, which makes them more affordable, and will result in downward pressure on the cost of living and inflation. Crowd-based capitalism will stand alongside our 20th-century corporate model as one of the mainstream ways in which the world's economic activity is organized, says author and business Professor Arun Sundararajan. In many industries, the largest company in the sector is likely to be a crowd-based platform.

1. Describe THREE (3) characteristics of old capitalism economy as stated in the story and elaborate them with examples.

2. Explain THREE (3) characteristics of sharing economy as illustrated in Airbnb story.

3. Discuss TWO (2) fiscal opportunity and TWO (2) regulatory challenges faced by the government in crowd-based platform economy. Illustrate your points with recent scenario.