Relax: we will never reach ‘peak stuff ’

Here is a simple rule that will never let you down: disregard all theories that tell you that the basic laws of economics and human nature have just been revoked. That includes the intriguing – yet just as bogus – assertion that we have reached “peak stuff ” – in other words, that we are nearing saturation when it comes to goods and services.

There is a kernel of truth at the heart of this statement: new technology means that we are slowly embracing the sharing economy. Websites and digital services are making it dramatically easier to match supply and demand in many areas: Airbnb, for example, is allowing millions of people to rent out spare rooms or entire houses.

All over the world, companies are emerging that rent everything from power tools to bikes to skiing equipment, all items that consumers rarely need. State-of-the-art platforms, digital payment technologies and user-generated ratings allow people to transact safely with absolute strangers.

A huge amount of previously unusable capacity – spare seats in cars, empty space on people’s drives – can now be commercialised. The sharing economy allows us to to monetise currently dead assets. It is becoming even easier for people to become self-employed: the rise of the Uber driver is a case in point. The asset-rich but cash poor will finally be able to generate new revenue streams with what they already own.

So it is true that we will cut back on some goods, especially those that we use infrequently (such as chainsaws). In urban areas, more people will find it makes sense to rent cars or use Uberstyle services rather than owning their own vehicles, safe in the knowledge that their own car would otherwise lie unused almost all of the time.

Another simultaneous change is taking place: the need to own some previously physical objects (such as records) is much reduced by the ability to rent them digitally.

But this doesn’t mean that we will want to cut back on all goods, or even all of those that can now be rented out more easily. The implications on supply and demand are unclear. It will become even more valuable to own a house, so more people may wish to do it: spare rooms, garages and lofts will be easier to rent and will become revenue-generating assets. Space will be easier to rent, so more people may decide to own more physical objects.

Even the widely-held view that technology will lead to a collapse in the private ownership of cars is questionable. The rise of self-driving vehicles will increase the number of car journeys; in some cases at least, it will be possible for individuals to call up (and thus rent) a car when they need it. The vehicle would then take them to work; rather than parking all day in front of the office, lying idle, the car would then drive off again and ferry other people around during the day. Another vehicle would pick up the customer in the evening and take them home. In such cases, self-driving cars will be rented, reducing the need for the private ownership of cars. It would also cut the need for parking in central locations.

In other cases, however, families will want to retain the ownership of vehicles. They will seek to customise them for their children, or for elderly people, or because they want a particular model at all times, or even because they wish to turn them into moving offices. They will want the self-driving car to be ready for them to use when needed, especially if their commute is very long (as will become more frequent in this brave new world, as it will be possible to sleep, relax or work while driving). The explosion in the demand for car journeys could even lead to an overall increase in car ownership – or at least both rental and traditional models would doubtless co-exist.

The key point is that if consumers are able to spend less money actually buying some goods, renting some on a just-in-time basis instead, they will have more cash left over to spend on other things.

The world isn’t a closed, zero-sum game: it is a dynamic, growing system. Human nature hasn’t changed: we will always want more “stuff ” than we have.

‘The world isn’t a closed zero-sum game: it is a dynamic growing system’