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  4. Preliminary Program
  5. Labor Market Applications of Economics in the Tech Sector
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Labor Market Applications of Economics in the Tech Sector

Paper Session

Sunday, Jan. 9, 2022 3:45 PM - 5:45 PM (EST)

Hosted By: Econometric Society
  • Chairs:
    Elizabeth Mishkin, Uber Technologies, Inc.
  • Jonathan V. Hall, Uber Technologies, Inc.

Driving the Gig Economy

Katharine Abraham
,
University of Maryland
John Haltiwanger
,
University of Maryland
Claire Hou
,
University of Maryland
Kristin Sandusky
,
U.S. Census Bureau
James Spletzer
,
U.S. Census Bureau

Abstract

The introduction of online platforms for matching workers to tasks is widely perceived to have accelerated the pace of change in work arrangements. This paper focuses on Taxi and Limousine Services, the sector in which the prototypical gig worker—a contract driver finding work through a ridesharing platform—reports self-employment activity. Growth in the number of nonemployers in Taxi and Limousine Services has dramatically outpaced the growth in any other industry. Using administrative data on self-employment earnings in this sector together with administrative data on the same individuals’ wage and salary earnings, we document significant changes in driver characteristics and the way in which drivers combine self-employment with wage and salary employment. Examining factors that might push or pull workers into self-employment in Taxi and Limousine Services, we find evidence consistent with lowered barriers to entry having made ridesharing a more attractive option for workers who experience adverse economic shocks. The introduction of ride-sharing platforms, however, has led to lower earnings and industry exit among incumbent taxi drivers.

Changing the Pyramids: The Impact of Broadband Internet on Firm Employment Structures

Giuseppe Trevisan
,
Federal University of Pernambuco
Antonio Barbosa
,
Federal University of Paraíba
Dieison Casagrande
,
Federal University of Santa Maria
Patrick Maier
,
University of Tuebingen

Abstract

We study how the introduction of broadband technology affects the occupational and
educational structure of firms. Using Brazilian data, we circumvent endogeneity issues
by exploiting quasi-random variation in the roll-out of fast internet and a physical
constraint in ADSL connectivity. Establishments respond to broadband availability
by expanding the share of management and operational positions at the bottom of
the firm hierarchy at the expense of other top and middle layers. Furthermore, we
observe employment polarization with respect to education and a clear negative effect
on overall employment. The patterns are complex, such that they cannot
be fully explained by the traditional skill-biased technological change or routinization
hypotheses found for automation and computerization phenomena. The consistent
evidence for the management layer across all types of firms strongly supports predictions
of organizational theories and suggests that, in the initial stage, broadband might have
introduced more nonroutine problems to be solved by managers. While our findings
reveal that broadband diffusion may exert distorting effects on labor markets in emerging
economies, they also suggest that resulting rearrangements in the internal employment
structure are driven by efficiency-seeking firm behavior and are an important mechanism
helping them to survive in the market.

Information About Vacancy Competition Redirects Job Search

Monica Bhole
,
Facebook
Andrey Fradkin
,
Boston University
John Horton
,
Massachusetts Institute of Technology and NBER

Abstract

Job seekers typically do not know the degree of competition they face for a particular vacancy. As a result, they may unwittingly send applications to vacancies with a lot of competition and may overlook vacancies with little competition. We study how providing information about competition for a vacancy redirects applications. To do so, we conduct three field experiments on a large online job platform in which treated job searchers are shown information about the number of prior applicants to a vacancy. This information increases overall applications and redirects applications to vacancies with few prior applications. Applications are sent to vacancies that receive fewer cumulative applications but result in similar outcomes to control applications. We use a complementary treatment to show that job seekers also use the age of the vacancy to direct search towards newer vacancies with relatively little competition. Our results are consistent with a model in which searchers have imperfect information about competition for a vacancy and redirect their search towards less competitive vacancies when they receive an improved signal.
JEL Classifications
  • J4 - Particular Labor Markets