Trade, Competition and Welfare in Global Online Labour Markets: A 'Gig Economy' Case Study

The Spread of Gig Economy: Trends and Effects

“…The significant negative per capita income suggests that workers from low-income countries are induced to participate in the gig economy. The employers and the firms contracting out gig work are predominantly located in high-income countries, while the gig work can be outsourced to low- income countries [Gomez-Herrera et al, 2017;Song et al, 2019]. Within a particular country, as the evidence from the US suggests, high-skilled workers who already have traditional jobs are less likely to alter their behavior to search for gig work [Collins et al, 2019].…”

“…Online labor markets such as Freelancer and Upwork are likely to substitute for physical labor migration and hence the uptake in working opportunities on digital platforms. The gig jobs have a spill-over effect not only on labor markets [World Bank, 2015;Gomez-Herrera et al, 2017]. For example, after the introduction of taxi services by Uber and Ola, taxi fares were reduced in major cities in India [Pandya et al, 2017].…”

“…Drawing from an earlier discussion in this paper, we expect the gig economy to positively affect the incomes of the gig workers. Gomez-Herrera et al [Gomez-Herrera et al, 2017] find that workers from low-income countries are likely to participate in jobs offered by the high-income countries. 19 Accordingly, we include log of per-capita income as an explanatory variable.…”