Rules and regulations often tend to lag behind the emergence of new industries, products, and services. Whether it be autonomous vehicles, drones, food delivery services, or any other market innovation, the law is frequently playing catch up. This is because innovation, by its nature, is something new that challenges the status quo. As a result, regulations often do not address the innovation in question or are hurriedly introduced after the fact. More often than not, these regulations are poorly designed, shaped by the input of competitors and critics, and are harmful to innovation.

This has been the experience of California start-up Swimply and its innovative pool-sharing service. Founded in 2008, Swimply allows homeowners to rent out private pools and other amenities like BBQ grills and basketball, pickleball, and tennis courts. While similar to other short-term rental companies like Airbnb and Vrbo, Swimply is unique in that it focuses on providing customers access to specific property features. These features can be rented on an hourly or daily basis, affording consumers maximum flexibility.

However, some state and county governments are confused about how to classify or regulate Swimply as a business. This has led some government officials to either ban or misclassify their operations or lump them together with public pools. Such actions are a mistake that threatens to undermine innovation and snuff out a valuable service that consumers demand.

Read the full Real Clear Markets article here.

Nate Scherer is a policy analyst with the American Consumer Institute, a nonprofit education and research organization. For more information about the Institute, visit us at www.TheAmericanConsumer.Org or follow us on X @ConsumerPal.