Regulating with Open Data

Chicago Skyscrapers

Photo courtesy of Flickr user Sayamindu Dasgupta

A few months ago, I dug into the issue of how state and local governments regulate sharing economy companies that operate in their jurisdictions. I argued that open data should play an key role in a new regulatory approach for these 21st century companies.

With a new battle over how the sharing economy is regulated taking shape in the City of Chicago, I’m more convinced now than ever that open data can and should play a central role in how governments regulate this new breed of companies.

In my original post, I argued that one way to use open data to help local governments efficiently regulate sharing economy companies was to require them to submit data to the regulating government, possibly as open data on the government’s very own open data portal.

Thinking about it now, I think sharing data the other way may actually make more sense.

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Open Data and 21st Century Regulation

In early December, Airbnb made headlines by releasing some data on how people are using the company’s platform in New York City.

In doing so, the company has provided an object lesson in the critical role that data plays (and will continue to play) in government regulation of private companies in the 21st century, and highlighted how ill-equipped governments are to obtain and use this data.

Airbnb and the State

Over the past year, the use of Airbnb to rent properties in New York has received intense scrutiny from government regulators because of suspicion that a non-trivial amount of rentals listed on the site were in violation of state or city rules. In late 2014, New York State Attorney General Eric Schneiderman released a report examining Airbnb rentals in New York that concluded that “most short-term rentals booked [through Airbnb’s service] in New York violate the law.”

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