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How Organizations Strategically Govern Online Communities

For organizations in the sharing economy, the online communities they host, where users interact with each other, are core to value creation. Little is known, however, about the organizational practices used to govern these online communities – to encourage participation and to direct, coordinate, and control interactions strategically. We address this gap with a comparative case study in the Berlin sharing economy and identify three governance practices. Scoping community boundaries encourages participation by demarcating the perimeters of interaction and defining the online community as a distinct social space; nudging social relations encourages participation by providing stimuli for interaction; and steering users exerts a form of social control over interactions. We discovered that organizations rely on both online and offline technologies to govern. Building on these findings, we develop a framework that helps to unpack why organizations use governance practices differently and how these practices relate to the value-creation potential of organizations. Our study highlights the dual role of organizations in the sharing economy as curators and guardians of online communities and displays the potential of sharing economy research to enhance knowledge about value creation, online communities, and organizational governance.

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