Unemployment and Worker Participation in the Gig Economy: Evidence from an Online Labor Market

2020 ◽  
Vol 31 (2) ◽  
pp. 431-448 ◽  
Author(s):  
Ni Huang ◽  
Gordon Burtch ◽  
Yili Hong ◽  
Paul A. Pavlou
Keyword(s):  
Labor Market ◽  
Labor Markets ◽  
Barriers To Entry ◽  
Flexible Work ◽  
Digital Platforms ◽  
Work Arrangements ◽  
Gig Economy ◽  
Complete Work ◽  
Online Labor Markets ◽  
Online Labor

The gig economy comprises a large portion of the workforce in today’s economy. The gig economy has low barriers to entry, enabling flexible work arrangements and allowing workers to engage in contingent employment, whenever, and in some cases, such as online labor markets, wherever, workers desire. And many of the workers seek and complete work via digital platforms. However, there is a lack of understanding into the participation in such platforms. The growth of the gig economy has been partly attributed to technological advancements that enable flexible work environments. In this study, we consider the role of an alternative driver, economic downturns, and associated financial stressors in the offline economy, for example, unemployment. Our analysis combines data from a leading online labor market and various archival sources such as the Bureau of Labor Statistics. We find local economic conditions significantly impact the intensive and extensive margins of labor supply in online labor markets. And such impacts are heterogeneous across different county characteristics. Given the prominence of the gig economy, we believe more research is needed to understand gig-economy participation. It is notable that policy makers recently started to look at related issues, proposing laws to protect the gig workers, such as the recent California Assembly Bill 5.

scholarly journals The persistence of pay inequality: The gender pay gap in an anonymous online labor market

2019 ◽  
Author(s):  
Leib Litman ◽  
Jonathan Robinson ◽  
Zohn Rosen ◽  
Cheskie Rosenzweig ◽  
Josh Waxman ◽  
...  
Keyword(s):  
Labor Market ◽  
Labor Markets ◽  
Wage Gap ◽  
Gender Pay Gap ◽  
Pay Gap ◽  
Men And Women ◽  
Work Arrangements ◽  
Online Labor Markets ◽  
Experience Education ◽  
Online Labor

Studies of the gender pay gap are seldom able to simultaneously account for the range of alternative putative mechanisms underlying it. Using CloudResearch, an online microtask platform connecting employers to workers who perform research-related tasks, we examine whether gender pay discrepancies are still evident in a labor market characterized by anonymity, relatively homogeneous work, and flexibility. For 22,271 Mechanical Turk workers who participated in nearly 5 million tasks we analyze hourly wages by gender, controlling for key covariates which have been shown previously to lead to differential pay for men and women. On average, women’s hourly earnings were 10.5% lower than men’s. Several factors contributed to the gender wage gap, including the tendency for women to select tasks that have lower advertised hourly pay. This study provides evidence that gender pay gaps can arise despite the absence of overt discrimination, labor segregation, and inflexible work arrangements, even after experience, education, and other human capital factors are controlled for. Findings highlight the need to examine other possible causes of the gender pay gap. Potential strategies for reducing the pay gap on online labor markets are also discussed.

scholarly journals Platforms as entrepreneurial incubators? How online labor markets shape work identity

2019 ◽  
Vol 34 (4) ◽  
pp. 246-268
Author(s):  
Francesca Bellesia ◽  
Elisa Mattarelli ◽  
Fabiola Bertolotti ◽  
Maurizio Sobrero
Keyword(s):  
Labor Markets ◽  
Identity Construction ◽  
Entrepreneurial Orientation ◽  
Working Relationships ◽  
Work Identity ◽  
Content Type ◽  
Digital Platforms ◽  
Online Labor Markets ◽  
Online Labor ◽  
The Relationship

Purpose The purpose of this paper is to explore how the process of work identity construction unfolds for gig workers experiencing unstable working relationships in online labor markets. In particular, it investigates how digital platforms, intended both as providers of technological features and online environments, affect this process. Design/methodology/approach The authors conducted an exploratory field study and collected data from 46 interviews with freelancers working on one of the most popular online labor markets and from online documents such as public profiles, job applications and archival data. Findings The findings reveal that the online environment constrains the action of workers who are pushed to take advantage of the platform’s technological features to succeed. This interplay leads workers to add new characteristics to their work-self and to and to develop an entrepreneurial an entrepreneurial orientation. Practical implications The study offers insights to platform providers interested in improving workers’ experiences in online labor markets, highlighting mechanisms for uncertainty reduction and diversifying a platform’s services according to gig workers’ identities and orientations. Originality/value The study expands the authors’ knowledge on work identity construction processes of gig workers, detailing the relationship between work identity and IT, and documents previously unexplored antecedents of entrepreneurial orientation in non-standard working contexts.

scholarly journals What type of labor lies behind the on-demand economy? New research based on workers’ data

2018 ◽  
pp. 1-17 ◽  
Author(s):  
Santiago Melián-González ◽  
Jacques Bulchand-Gidumal
Keyword(s):  
Labor Market ◽  
Theoretical Work ◽  
Work Conditions ◽  
Anecdotal Evidence ◽  
Digital Platforms ◽  
Work Arrangements ◽  
On Demand ◽  
Digital Labor ◽  
Gig Economy ◽  
New Research

AbstractOn-demand and gig economy are names commonly used when discussing issues related to labor in the collaborative economy. Some of the specific digital platforms in this economy, including Uber and TaskRabbit, and Upwork are quite popular. The term digital labor market has been suggested to distinguish the work mediated by these platforms from that of the traditional labor market. The theoretical work conditions and characteristics of this digital labor market are similar to those of negative nonstandard work arrangements. However, more empirical evidence is required because most of the findings about work conditions are based on anecdotal evidence and the analysis of the platforms’ rules. This study collects the characteristics commonly attributed to the digital labor market and analyzes them based on data about 465 workers extracted from two important digital labor platforms. Our results confirm and refine some of the beliefs found in the literature.

More for Less: Adaptive Labeling Payment for Online Labor Markets

2016 ◽  
Author(s):  
Tomer Geva ◽  
Harel Lustiger ◽  
Maytal Saar-Tsechansky
Keyword(s):  
Labor Markets ◽  
Online Labor Markets ◽  
Online Labor

Scoundrels or Stars? Theory and Evidence on the Quality of Workers in Online Labor Markets

2016 ◽  
Vol 92 (1) ◽  
pp. 93-114 ◽  
Author(s):  
Anne M. Farrell ◽  
Jonathan H. Grenier ◽  
Justin Leiby
Keyword(s):  
Labor Markets ◽  
Data Availability ◽  
Accounting Research ◽  
Research Participants ◽  
Large Numbers ◽  
Research Designs ◽  
Online Labor Markets ◽  
Online Labor ◽  
Low Pay

ABSTRACT Online labor markets allow rapid recruitment of large numbers of workers for very low pay. Although online workers are often used as research participants, there is little evidence that they are motivated to make costly choices to forgo wealth or leisure that are often central to addressing accounting research questions. Thus, we investigate the validity of using online workers as a proxy for non-experts when accounting research designs use more demanding tasks than these workers typically complete. Three experiments examine the costly choices of online workers relative to student research participants. We find that online workers are at least as willing as students to make costly choices, even at significantly lower wages. We also find that online workers are sensitive to performance-based wages, which are just as effective in inducing high effort as high fixed wages. We discuss implications of our results for conducting accounting research with online workers. Data Availability: Contact the authors.

scholarly journals Adapting Income Taxation to the Labor Market Changes

2021 ◽  
Vol 31 (2) ◽  
pp. 167-178
Author(s):  
Anna Kireenko ◽  
Svetlana Sodnomova
Keyword(s):  
Labor Market ◽  
Income Taxation ◽  
Work Skills ◽  
Digital Platforms ◽  
Gig Economy ◽  
Tax Deductions ◽  
Data Statistics ◽  
Market Trends ◽  
Progressive Income Taxation ◽  
Market Changes

The article is concerned with the analysis of the labor market changes, requiring the personal income tax reform. Methods of comparative and statistical analysis are applied. Rating and analytical agencies data, statistics from the OECD, Eurofond and Eurostat used as the empirical base of the study. Three labor market trends requiring appropriate changes in taxation were identified. The first trend is the change in the demand for work skills, which requires a more flexible approach to educational tax deductions and tax incentives for training in high-demand digital professions. The second trend is digital platforms and the gig economy that enhance income differentiation, which inevitably raises the question of progressive income taxation. The third trend is an increase in non-standard employment. The article analyzes such forms of non-standard employment as work on the basis of vouchers, platform work, joint employment, casual labour which are associated with the ambiguous status of employment and require changes in tax policy to regulate them.

scholarly journals Monopsony in Online Labor Markets

2018 ◽  
Author(s):  
Arindrajit Dube ◽  
Jeff Jacobs ◽  
Suresh Naidu ◽  
Siddharth Suri
Keyword(s):  
Labor Markets ◽  
Online Labor Markets ◽  
Online Labor

Just DM Me (Politely): Direct Messaging, Politeness, and Hiring Outcomes in Online Labor Markets

2021 ◽  
Author(s):  
Yili Hong ◽  
Jing Peng ◽  
Gordon Burtch ◽  
Ni Huang
Keyword(s):  
Labor Markets ◽  
Communication Channel ◽  
Message Content ◽  
Job Fit ◽  
Beneficial Effects ◽  
Online Labor Markets ◽  
Lower Status ◽  
Prospective Employer ◽  
Online Labor

This study examines the role of text-based direct messaging systems in online labor markets, which provide a communication channel between workers and employers, adding a personal touch to the exchange of online labor. We propose the effect of workers’ use of the direct messaging system on employers’ hiring decisions and conceptualize the information role of direct messaging. To empirically evaluate the information role of the direct messaging system, we leverage data on the direct messaging activities between workers and employers across more than 470,000 job applications on a leading online labor market. We report evidence that direct messaging with a prospective employer increases a worker’s probability of being hired by 8.9%. However, the degree to which workers benefit from direct messaging is heterogeneous, and the effect amplifies for workers approaching employers from a position of disadvantage (lacking tenure or fit with the job) and attenuates as more workers attempt to message the same prospective employer. The effects also depend on message content. In particular, we find that the benefits of direct messaging for workers depend a great deal on the politeness of the workers, and this “politeness effect” depends on several contextual factors. The beneficial effects are amplified for lower-status workers (i.e., workers lacking tenure and job fit) and workers who share a common language with the employer. At the same time, the beneficial effects weaken in the presence of typographical errors. These findings provide important insights into when and what to message to achieve favorable hiring outcomes in online employment settings.

Conclusion

2021 ◽  
pp. 161-164
Author(s):  
Eric A. Posner
Keyword(s):  
Artificial Intelligence ◽  
Labor Market ◽  
Labor Markets ◽  
Human Beings ◽  
Independent Contractors ◽  
Gig Economy ◽  
Long Run ◽  
The Social ◽  
Market Fragmentation ◽  
Social Surplus

Many people are worried about the fragmentation of labor markets, as firms replace employees with independent contractors. Another common worry is that low-skill work, and ultimately nearly all forms of work, will be replaced by robots as artificial intelligence advances. Labor market fragmentation is not a new phenomenon and can be addressed with stronger classification laws supplemented by antitrust enforcement. In fact, the gig economy has many attractive elements, and there is no reason to fear it as long as existing laws are enforced. Over the long run, artificial intelligence may replace much of the work currently performed by human beings. If it does, the appropriate response is not antitrust or employment regulation but policy that ensures the social surplus is fairly divided.

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