**3. Results**

The introduction of the quarantine caused by the COVID-19 pandemic resulted in the increasing amount of Internet users who spent more time on the Web, increasing the share of online businesses, increased the share of online demolition, as evidenced by analytical data on purchases and activity in social networks. At the same time, many sectors suffered losses, which affected the population's revenues and encouraged the development of lease relations in society. Due to everyone's desire to minimize expenses and contacts with other people because of COVID-19, the development of the sharing economy has become not just ecologically grounded but also economically viable in many countries, particularly in countries with a low income per capita.

One international sharing example is Uber, which has set the fare and service fee and is available in more than 70 countries. The company has launched its application and developed a rating system to protect users' data to avoid fraudulent schemes. Ioanna Constantinou and others investigated the largest sharing platforms (Airbnb, Uber, Handy, Couchsurfing, Lyft, TaskRabbit, etc.) and distinguished four main areas of sharing: Franchiser, Principal, Chaperone and Gardener, which have several competitive advantages over traditional businesses [13]. The development of own digital systems, apps and services based on the everyday use of goods and the enhancement of the user function has become the foundation for the establishment of the circular economy that applies resources being in turnover and creating their market and business models of social cohesion where the Internet is the core method of information exchange [14].

The sharing services market in Ukraine has started growing rapidly over the past ten years due to free access to the Internet not only on PCs but also on mobile gadgets. It gave the impetus to the rapid exchange and sharing of goods and services. (Figure 1).

**Figure 1.** The volume of sold online services in Ukraine on a time interval, million EUR [15].

According to the State Statistics Service of Ukraine [15], mobile services (about 54%) and Internet services (17%) are leaders in terms of funds in the structure of telecommunications and postal services. The greatest amount of sold products in the communications sector due to regions can be seen in actual prices including VAT in Kyiv (898 million EUR), Donetsk (146 million EUR), Odesa (129 million EUR) and Kharkiv (1170 million EUR) regions, which are the most economically developed regions of Ukraine. These numbers are growing year-by-year (by 9% in 2018 compared to 2017), indicating an increase in the area of Internet coverage and increasing funding in this sector. It provides favorable conditions for the development of the sharing economy [13,14].

Data of the leader leading one shows an increase in the trend of sold services confirmed by data expressed in UAH, although we can see a decrease in sales (up to 257 million EUR) when calculated in EUR due to the exchange rate growth in 2014–2015 and its subsequent fluctuations. However, Internet users have been growing steadily since 2000, including during the pandemic. Car sharing, bicycle, scooter, household equipment and equipment rental were analysed. Over the past five years, we have seen an increasing number of mobile users and cash receipts in mobile services providing access to the Internet. The role of mobile gadgets plays a significant role in the lives of Ukrainians. This increases the number of online purchases and transactions, mostly in cities (76.3%–7.66 million households as of 2019, which is 10.5% more than in 2018) and settlements with more than 5000 inhabitants, which is explained by the predominance of the population under 50 in the age structure of the inhabitants who have modern mobile devices with free access to the Internet and can use online services. According to the State Statistics Committee of Ukraine, men aged 25–35 (22.4%) and women aged 18–24 (35%) accounted for the most significant percentage of the population buying or renting goods online in 2017. In 2019, men aged 25–35 accounted for 19.8%, increasing the age distribution of users, and women aged 25–35 (29%) became more active. This fact indicates an increase in the age interval between users in terms of both age reduction and raising [15]. Depending on the average equivalent monetary income of households per capita, one can conclude that more active users of sharing services are households with more than 4,800 UAH (148 EUR) in 2017 and

families with an income of more than 12,000 UAH (372 EUR) in 2019. Sharing services are slowly developing in regions with the lowest number of Internet users at the regional level.

In 2017: Volyn, Zhytomyr, Odesa, Vinnytsia and Kherson regions. In 2019: Volyn, Ternopil, Khmelnytsk, Kirovohrad, Poltava and Kyiv regions.

Megalopolises and Kharkiv, Dnipropetrovsk, Zaporizhzhia, Mykolaiv, Zakarpattia, Ivano-Frankivsk Ternopil and Chernivtsi regions, were most active in 2017. In 2019, this list was supplemented with Donetsk, Lviv, Odesa and Sumy regions. The number of users increased by more than 10% of the total number of households. One of the leaders in providing sharing services is the Donetsk economic region (22.4% in 2019) characterised by the industrial economy, constant migration and increasing demand for temporary goods [15].

The share of the population aged 16–74 who have reportedly used the Internet over the past 12 months worldwide depends on the state's economic development, as shown in the tables [16,17]. Leaders in terms of access to Internet services in 2018 included Luxembourg (97.4%), Denmark (97.3%), Norway (96.4%), the United Kingdom (94.9%), the Netherlands (94.7%) [17]. The correlation coefficient between Internet users and gross domestic product per capita is 89%, indicating a direct close relationship.

According to the EVO group of companies, the total amount of physical goods and services purchased by Ukrainians on the Internet in 2020 reached 3.4 billion EUR [18], and the number of online payments increased by 50% compared to 2019. The pandemic has accelerated the development of e-commerce and increased confidence in the use of innovative services. The largest sharing services websites in Ukraine include Blablacar, Rozetka.com.ua, Olx.ua, Ria.com, Jarmarok.com.ua, Rentaua.com, Ogolosha.ua, Obyava.ua, Besplatka.ua, Prom.ua. They provide information about different types and categories of sharing goods and services based on the rating system of users, which warn lessees about potential fraud and poor work. Online crediting, one of the forms of sharing, is also growing rapidly in Ukraine. However, it is still considered as an unfavourable service because of high-interest rates and poor performance of financial institutions, the involvement of banned collection companies and the abuse of fines.

Due to the reduction of Ukraine's GDP in 2020 by 4%, amounting to 1 trillion 36 billion EUR and 3.25 thousand EUR per capita [15], one expects the increasing use of sharing services in order to reduce the cost of living of each individual and find the ways to increase business profits. The growing number of Internet users and the promotion of online purchases caused by the pandemic and the depreciation of contacts with people are also reasons for finding new options for obtaining necessary services, which will boost product sharing. One predicts the increase in sharing services among goods whose prime cost is more than 870 EUR by 30% in 2021 compared to 2020 and the increase in the number of users by 40% primarily in urban areas, while most rural residents with worse living standards will find sharing services non-demanded. According to search queries, Ukraine has about 29,200 companies providing sharing services, and their number will increase along with the number of sharing services provided to individuals without registration.

Price formation of sharing services depends partially on the cost of production of goods and mainly on depreciation expenses. There is a fundamental difference between lessors who consider sharing as a business and lessors who lease out goods that are not in use and have no consumer value for the owner at present. The supply of sharing services will be determined by lessors' interest to receive funds for the benefit of goods and not lose their ownership, caused by the need for additional financial income and the availability of free time to sell goods. Depending on the period of use, the residual value of the product decreases, determining the cost of its supply, analysing 100 products in five categories subject to selling and the loss of ownership and 100 products in similar categories leased out on the Olx.ua, the use-value of goods declines unevenly (Figure 2).

**Figure 2.** Changes in goods' sale (rental) price of goods depending on their physical wear in Ukraine, 2020 [19].

Figure 2 shows that in the case of the production of goods, their sale price is 100% and includes all the expenses for display and sale. In the case of zero use of the product, most sellers sell it at the total sale price on the market. In the case of leasing out the same effect, its rental price is on average 12% of the sale price and changes only when the product is worn by 80%. Unlike a rental yield, the sale price changes with the wear and tear of the product and even at maximum wear and mostly in invalid condition, it can be sold at a price of about 5% of the initial sale price in the absence of use. In contrast, the product losing consumer properties can no longer be leased out. It proves that the leased goods are stable in the rental price, which primarily includes depreciation expenses and the owner's profit and is less dependent on the product condition.

In contrast, the product's sale price is more flexible and depends on the product condition and external factors. The given conclusions can be used to predict the sale and rental price of the product, research its life cycle and analyse the market. Figure 2 shows that sharing goods and services is less flexible concerning goods sold on the market, equating them with essential commodities.

Prices for sharing goods determine their demand, which is reflected in the supply of goods. As 2020 and 2021 featured the increasing number of Internet users and declining incomes of most of the Ukrainian population, the demand for sharing services increased according to most online stores and customers leaving feedback about products on social networks. According to Olx.ua [19], the Rozetka online store and the survey of 50 respondents on social networks, one conducted a study on the demand for shared goods depending on the individual's income (Figure 3).

One has found out that the middle-income population is the most common user of shared services. In contrast, the people with insufficient budget (up to 172 EUR per month per person) (up to 10% of users) or with an income of more than 4312 EUR thousand per month (in Kyiv) uses shared services in small volumes, which can be the framework for the development of a strategy for promoting shared services and designing advertising campaigns [20].

Figure 3 shows that the share of the population using shared services increases with the growing income to 1300 EUR per month per person (about 60% of the demand) by some users. In contrast, the population with higher aggregate incomes tends to buy goods rather than share.

**Figure 3.** Diagram of population's differentiated income and the dependence of the demand for Scheme 2020.

The use of shared products can be considered a source of alternative income by reducing the price of using the product. In contrast, when buying the same product and meeting the exact needs, using the required resource decreases significantly (in the case of the constant total utility function, the price is lower).

The sharing of goods and services on the Internet (for example, websites sharing software, music, apps, games) has been growing recently. Most companies develop advertising strategies based on the snob effect (Veblen goods) due to their limited number and exclusivity, leading to non-market mechanisms and increased sharing [21].

Marketers widely use the promotion of Veblen goods because of the existence of many bloggers, celebrities who advertise the product on the Internet, increasing its importance and thus increasing the demand. The establishment of the individual's worldview as a potential customer increases the psychological dependence of people on the availability of a particular product that can shape its image and improve its status, which in turn also enhances the demand for sharing [22]. The increasing number of online transactions and the demand for remote goods create conditions for the emergence of the so-called digital market of goods and services, a part of which is sharing, allowing reducing costs and bearing no responsibility for storing goods, their proper condition and depreciation, as these obligations apply only to the owner of the goods, not the lessee.

As a country with poor environmental responsibility and education, Ukraine uses sharing to save costs and comfortably utilize goods without maintenance expenditures. At the same time, developed countries adopt the sharing economy from an eco-friendly perspective [23].

Considering sharing as a part of the concept of product rational use, we can see, at first glance, a significant increase in the life cycle of goods, which positively affects the global environment by reducing the production of goods and anthropogenic burden. The shared use of goods encourages the overproduction of goods and resource-saving and creates a more complimentary and more accessible system of user relationships. A striking example is the transport system based on sharing (public transport) and the recreational sector (resorts, hotels, entertainment, leisure areas, etc.) [24,25]. C2C is the critical trend in 2020–2021 characterised by the transfer of goods for public use from consumers to consumers using online services and social networks. People can spend the saved time on product maintenance to sort out garbage, which requires on average 15 min daily [26], equivalent to 0.34 EUR for Ukraine given the minimum wage as of 2021 [27]. Sharing helps reduce waste, improve the region's ecological state, and establish a circular economy that creates new mechanisms of economic activity in symbiosis with sharing.

When calculating the negative impact on the ecosystem in mechanical engineering, we can see the change in all ecosystem elements around the production plant (points of influence). Atmospheric emissions during the manufacturing of vehicles are dangerous because of the release of sulphur dioxide, carbon monoxide, hexavalent chromium and other heavy metals. Operations also produce waste that gets into the water, making it poisonous and unfit for drinking and dangerous to human health and life. Soils are polluted and natural landscapes and ecosystems are changing. The industry is characterised by significant waste generated, most of which is not reused. In addition to emissions during car operation, a modern car consumes about 50 kg of oxygen per hour.

The cost of car recycling as of 2020 is 260 EUR for passenger cars belonging to individuals; 1725 EUR for commercial vehicles, which is high enough for Ukraine and this leads to illegal disposal of vehicles that negatively affects the ecosystem.

The cost of changing the ecosystem in car manufacturing is about 2587 EUR (calculated based on the negative environmental impact that should be neutralised to bring the ecosystem to its original state at Skoda Auto). Speaking from the perspective of environmental conservation, the establishment of the sharing economy has a positive effect by meeting the public demand for goods and services via joint use without buying goods, which affects the production of goods, reducing the negative impact on the ecosystem. As to the transport sector, taxi services are the main lever for establishing the sharing economy.

The population of Kyiv as of 1 December 2020, was 2,963,199 people, i.e., seven taxi workers registered in taxi services per 1000 people, and the number of private cars per 1000 inhabitants of Kyiv is about 400 [15]. Thus, the reduction of the ecosystem burden due to sharing costs about 673 EUR per day in Ukraine, six thousand EUR (63 cars per 1000 people) in Moscow, and about 1121 EUR per day in Odesa [15].

The sharing economy is closely related to the circular economy based on the increase in the life expectancy of goods through its secondary use. With the introduction of the circular economy, companies plan their development differently, so it is reasonable to develop several scenarios for further activities.

The goal of the European Environment Agency is to reduce harmful emissions into the ecosystem by 2030 and implement decarbonization by 2050, which will also lead to the introduction of the sharing and circular economy [28].

Recently, car purchasing prevails over sharing in Ukraine and the EU countries, although later one will prefer car rental in order to reduce the negative environmental impact.

In the case of the linear economy (Figure 4), we can see a situation when resources are used to produce goods designed for one owner or user, which reduces the consumer properties of goods. The market and movements of financial resources around interests are limited, which is lesser than during sharing adoption. The resource–product–consumption– waste scheme has a negative ecological effect because of the increasing anthropogenic

impact caused by a large amount of waste and production, resulting from the higher demand for new goods among consumers.

**Figure 4.** Linear economy model.

One should apply European experience to adopt the sharing and circular economy (Figure 5). Let us consider, for example, an enterprise adopting the sharing economy in Latvia as in a former-Soviet country that has developed according to European standards. However, it has a range of problems and similar situations occurring in the period of the breakup of the Soviet Union and Ukraine. Latvia features a symbiosis of critical principles and laws of Europe and particularities of numerous post-Soviet countries. Ukraine can use Latvia's positive experience in adopting European values, improving living standards and creating favourable conditions for business growth. Therefore, the research is focused on Ukraine and Latvia.

Based on the company's activities, the authors have created three packages: pessimistic, standard and optimistic ones with different characteristics (Table 1) of implementing circular economic projects based on the company's data as case study.

## *3.1. Pessimistic Package*

This package assumes that the company does not change its current situation, namely does not introduce circular economy business models, does not participate in any programs to obtain a certificate ensuring and certifying eco-friendly farming of the company, does not move to other office spaces. The authors wanted to include the shift from three cars to one car and one electric vehicle in the pessimistic model. Project managers and designers mostly use the corporate vehicle. This model is intended to leave one car for other journeys, while the electric vehicle will move within the city [29].

The priority of this package is to reduce costs, and enterprises do not prioritize the integration of circular economy business models.

**Figure 5.** Circular economy model.


