Gig Economy: Is It a Trap or Stepping Stone for the Informal Sector?
Abstract
The informal sector and technology have complex interactions, shaping economic activity, job trends, and social outcomes, especially with the rise of the “gig economy”, in which individuals work on an as-needed basis through online platforms. This article explores several theoretical frameworks, such as modernization theory, dependence theory, structuralist approaches, and post-structuralist viewpoints, and investigates how different frameworks explain the effects of technology on informal economic activity. This article also reviews for comprehending the correlation between the informal sector and technology. Besides that, this article explores the dual nature of the gig economy, examining whether it serves as a trap that perpetuates the vulnerabilities of the informal sector or as a stepping stone toward more excellent economic stability and mobility. Although the gig economy provides opportunities for income generation, skill development, and flexible working conditions, it also presents substantial challenges, such as job insecurity, a lack of benefits, and potential exploitation. This paper also addresses the implications for policy and future research directions by the sustainable development goal (SDG) of fostering sustainable, inclusive, and long-term economic growth, as well as full and productive employment and decent work for all.
Downloads
References
Aboagye-Da-Costa, D. P. (2012). Internet Quality in Southern Ghana for Businesses Vendor: Viope Solutions Oy. Bachelor Thesis. Leppävaara, Finland: Laurea University of Applied Sciences.
Aker, J. C., & Mbiti, I. M. (2010). Mobile phones and economic development in Africa. Journal of Economic Perspectives, 24(3), 207-232. DOI: https://doi.org/10.1257/jep.24.3.207
Aker, J. C., Boumnijel, R., McClelland, A., & Tierney, N. (2016). Payment mechanisms and antipoverty programs: Evidence from a mobile money cash transfer experiment in Niger. Economic Development and Cultural Change, 65(1), 1-37. DOI: https://doi.org/10.1086/687578
Aneesh, A. (2015). Virtual migration: The programming of globalization. Duke University Press.
Berg, J. (2015). Income security in the on-demand economy: Findings and policy lessons from a survey of crowdworkers. Comp. Lab. L. & Pol'y J., 37, 543.
Bergvall?Kåreborn, B., & Howcroft, D. (2014). A Mazon Mechanical Turk and the commodification of labor. New technology, work and employment, 29(3), 213-223. DOI: https://doi.org/10.1111/ntwe.12038
Bosch, M., Goni-Pacchioni, F., & Maloney, W. F. (2012). Labor markets in Latin America: A supply-side story. Latin American Journal of Economics, 49(2), 189-228.
Burtch, G., Carnahan, S., & Greenwood, B. N. (2018). Can you dig it? An empirical examination of the gig economy and entrepreneurial activity. Management Science, 64(12), 5497-5520. DOI: https://doi.org/10.1287/mnsc.2017.2916
Castells, M., & Portes, A. (1989). World underneath: The origins, dynamics, and effects of the informal economy. The informal economy: Studies in advanced and less developed countries, 12.
Chant, S., & Pedwell, C. (2008). Women, gender, and the informal economy: An assessment of ILO research and suggested ways forward. International Labour Organization.
Chen, M. A., Vanek, J., & Carr, M. (2004). Mainstreaming informal employment and gender in poverty reduction: A handbook for policymakers and other stakeholders. Commonwealth secretariat.
Cherry, M. A., & Aloisi, A. (2016). Dependent contractors in the gig economy: A comparative approach. Am. UL Rev., 66, 635. DOI: https://doi.org/10.2139/ssrn.2847869
Codagnone, C., & Martens, B. (2016). Scoping the sharing economy: Origins, definitions, impact and regulatory issues. Cristiano Codagnone and Bertin Martens (2016). Scoping the Sharing Economy: Origins, Definitions, Impact and Regulatory Issues. Institute for Prospective Technological Studies Digital Economy Working Paper, 1. DOI: https://doi.org/10.2139/ssrn.2783662
De Stefano, V. M. (2016). The rise of the ‘just-in-time workforce’: on-demand work, crowd work and labor protection in the ‘gig-economy’. Comparative labor law and policy journal, 37(3), 471-504. DOI: https://doi.org/10.2139/ssrn.2682602
De Stefano, V. (2018). The rise of the just-in-time workforce: On-demand work, crowdwork, and labor protection in the gig economy. Harvard Business Review. https://hbr.org/2018/04/the-rise-of-the-just-in-time-workforce
De Stefano, V. (2018). The gig economy and labor regulation: an international and comparative approach. Law J. Soc. & Lab. Rel., 4, 68. DOI: https://doi.org/10.26843/mestradodireito.v4i2.158
Derrida, J. (2016). Of grammatology. Jhu Press. DOI: https://doi.org/10.56021/9781421419954
Donner, J. (2007). The rules of beeping: Exchanging messages via intentional “missed calls” on mobile phones. Journal of computer-mediated communication, 13(1), 1-22. DOI: https://doi.org/10.1111/j.1083-6101.2007.00383.x
Donner, J., & Escobari, M. X. (2010). A review of evidence on mobile use by micro and small enterprises in developing countries. Journal of International Development, 22(5), 641-658. DOI: https://doi.org/10.1002/jid.1717
Donovan, K. (2012). Mobile money for financial inclusion. Information and Communications for development, 61(1), 61-73. DOI: https://doi.org/10.1596/9780821389911_ch04
Donovan, S. A., Bradley, D. H., & Shimabukuru, J. O. (2016). What does the gig economy mean for workers? (CRS Report R 44365). Washington DC: Congressional Research Service.
Eurofound. (2015). New forms of employment. Publications Office of the European Union.
Farrell, D., Greig, F., & Hamoudi, A. (2018). The online platform economy in 2018: Drivers, workers, sellers, and lessors. JPMorgan Chase Institute.
Felstiner, A. (2011). Grappling with online work: lessons from cyber law. Louis ULJ, 56, 209.
Foucault, M. (2013). Archaeology of knowledge. Routledge. DOI: https://doi.org/10.4324/9780203604168
Frank, A. G. (1967). Capitalism and underdevelopment in Latin America (Vol. 93). NYU Press.
Galbraith, J. K. (2017). Seduced and betrayed: Exposing the contemporary microfinance phenomenon. University of New Mexico Press.
Geertz, C. (1963). The integrative revolution: primordial sentiments and civil politics in the new states. Old societies and new states: The quest for modernity in Asia and Africa, 105-157.
Gleim, M. R., Johnson, C. M., & Lawson, S. J. (2019). Sharers and sellers: A multi-group examination of gig economy workers’ perceptions. Journal of Business Research, 98, 142-152. DOI: https://doi.org/10.1016/j.jbusres.2019.01.041
Graham, M., Hjorth, I., & Lehdonvirta, V. (2017). Digital labor and development: impacts of global digital labor platforms and the gig economy on worker livelihoods. Transfer: European review of labor and research, 23(2), 135-162. DOI: https://doi.org/10.1177/1024258916687250
Graham, A. K., Wildes, J. E., Reddy, M., Munson, S. A., Barr Taylor, C., & Mohr, D. C. (2019). User?centered design for technology?enabled services for eating disorders. International Journal of Eating Disorders, 52(10), 1095-1107. DOI: https://doi.org/10.1002/eat.23130
Harris, J. R., & Todaro, M. P. (1970). Migration, unemployment and development: a two-sector analysis. The American Economic Review, 60(1), 126-142.
Heeks, R. (2017). Decent work and the digital gig economy: a developing country perspective on employment impacts and standards in online outsourcing, crowd work, etc. Development Informatics Working Paper, (71). DOI: https://doi.org/10.2139/ssrn.3431033
Hershatter, A., & Epstein, M. (2010). Millennials and the world of work: An organization and management perspective. Journal of business and psychology, 25, 211-223. DOI: https://doi.org/10.1007/s10869-010-9160-y
Hockly, N. (2018). Blended learning. Elt Journal, 72(1), 97-101. DOI: https://doi.org/10.1093/elt/ccx058
Howe, J. (2006). The rise of crowdsourcing. Wired magazine, 14(6), 176-183.
Huang, N., Burtch, G., Hong, Y., & Pavlou, P. A. (2020). Unemployment and worker participation in the gig economy: Evidence from an online labor market. Information Systems Research, 31(2), 431-448. DOI: https://doi.org/10.1287/isre.2019.0896
ILO, I. L. O. (2018). The impact of technology on the quality and quantity of jobs. Global Commission on THE FUTURE OF WORK, February(15-17 (Cluster 3)), 1–14.
ILO. (2020). Global Employment Trends for Youth 2020: Asia and The Pacific. In International Labour Organization (Vol. 33, Issue 1). https://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---publ/documents/publication/wcms_737648.pdf
Jack, W., & Suri, T. (2011). Mobile money: The economics of M-PESA (No. w16721). National Bureau of Economic Research. DOI: https://doi.org/10.3386/w16721
Kaine, S., & Josserand, E. (2019). The organization and experience of work in the gig economy. Journal of Industrial Relations, 61(4), 479-501. DOI: https://doi.org/10.1177/0022185619865480
Kalleberg, A. L. (2011). Good jobs, bad jobs: The rise of polarised and precarious employment systems in the United States, 1970s-2000s. Russell Sage Foundation.
Kässi, O., & Lehdonvirta, V. (2018). Online labor index: Measuring the online gig economy for policy and research. Technological forecasting and social change, 137, 241-248. DOI: https://doi.org/10.1016/j.techfore.2018.07.056
Lewis, W. A. (1954). Economic development with unlimited supplies of labor. DOI: https://doi.org/10.1111/j.1467-9957.1954.tb00021.x
Lim, S. (2018). Ride-sharing in Southeast Asia: Disruptive innovation or unequal opportunity? Asian Economic Review, 32(1), 45-62.
MacDonald, R., & Giazitzoglu, A. (2019). Youth, enterprise and precarity: or, what is, and what is wrong with, the ‘gig economy’? Journal of Sociology, 55(4), 724-740. DOI: https://doi.org/10.1177/1440783319837604
Maalaoui, A., Ratten, V., Heilbrunn, S., Brannback, M., & Kraus, S. (2020). Disadvantage entrepreneurship: Decoding a new area of research. European Management Review, 17(3), 663-668. DOI: https://doi.org/10.1111/emre.12424
McKinsey Global Institute (2016). Independent work: Choice, necessity, and the gig economy. https://www.mckinsey.com/featured-insights/employment-and-growth/independent-work-choice-necessity-and-the-gig-economy
Messenger, J. (2018). Working Time and the Future of Work. ILO Future of Work Research Paper Series (p. 44). Retrieved from https://www.ilo.org/global/topics/future-of-work/publications/research-papers/WCMS_649907/lang--en/index.htm
Moser, C. O. (1978). Informal sector or petty commodity production: dualism or dependence in urban development? World Development, 6(9-10), 1041-1064. DOI: https://doi.org/10.1016/0305-750X(78)90062-1
OECD Development Centre. (2020). Digital transformation in developing countries: The role of technological infrastructure. OECD Publishing.
Oei, S. Y., & Ring, D. M. (2017). Tax issues in the sharing economy: Implications for workers. Forthcoming, Cambridge Handbook on the Law of the Sharing Economy (Nestor M. Davidson, Michele Finck & John J. Infranca, eds.), Boston College Law School Legal Studies Research Paper, (480).
Prassl, J., & Risak, M. (2015). Uber, TaskRabbit, and co.: Platforms as employers-rethinking the legal analysis of crowd work. Comp. Lab. L. & Pol'y J., 37, 619.
Pew Research Center. (2016, November 17). Gig work, online selling, and home sharing. Pew Research Center. https://www.pewresearch.org/internet/2016/11/17/gig-work-online-selling-and-home-sharing/
Qiang, C. Z., Kuek, S. C., Dymond, A., Esselaar, S., & Unit, I. S. (2012). Mobile applications for agriculture and rural development. Washington, DC: World Bank.
Rauch, J. E. (1991). Modelling the informal sector formally. Journal of Development Economics, 35(1), 33-47. DOI: https://doi.org/10.1016/0304-3878(91)90065-4
Ravenelle, A. J. (2019). “We’re not Uber:” Control, autonomy, and entrepreneurship in the gig economy. Journal of Managerial Psychology, 34(4), 269-285. DOI: https://doi.org/10.1108/JMP-06-2018-0256
Rosenblat, A., & Stark, L. (2016). Algorithmic labor and information asymmetries: A case study of Uber’s drivers. International journal of communication, 10, 27.
Rostow, W. W. (1959). The stages of economic growth. The Economic History Review, 12(1), 1-16. DOI: https://doi.org/10.1111/j.1468-0289.1959.tb01829.x
Sazali, N. T., & Gen, T. Z. (2019). The Demise of Formal Employment?—a Literature Update on Informality.
Schwellnus, C., Geva, A., Pak, M., & Veiel, R. (2019). Gig economy platforms: Boon or Bane?
Scuotto, V., Beatrice, O., Valentina, C., Nicotra, M., Di Gioia, L., & Briamonte, M. F. (2020). Uncovering the micro-foundations of knowledge sharing in open innovation partnerships: An intention-based perspective of technology transfer. Technological forecasting and social change, 152, 119906. DOI: https://doi.org/10.1016/j.techfore.2019.119906
Smith, R. S. (2016). Taxation in the New Economy: New Models for the 21st Century. Economic Policy Review, 22(2), 18-38.
Stefano, V. D. E. (2016). The rise of the « just-in-time workforce »: On-demand work, crowd work and labor protection in the « gig economy » (Issue 71).
Stewart, A., & Stanford, J. (2017). Regulating work in the gig economy: What are the options? The Economic and Labour Relations Review, 28(3), 420-437. DOI: https://doi.org/10.1177/1035304617722461
Suri, T., & Jack, W. (2016). The long-run poverty and gender impacts of mobile money. Science, 354(6317), 1288-1292. DOI: https://doi.org/10.1126/science.aah5309
Tokman, V. E. (2007). The informal economy, insecurity, and social cohesion in Latin America. International Labour Review, 146(1-2), 81-107. DOI: https://doi.org/10.1111/j.1564-913X.2007.00006.x
Tran, M., & Sokas, R. K. (2017). The gig economy and contingent work: An occupational health assessment. Journal of Occupational and Environmental Medicine, 59(4), e63-e66. DOI: https://doi.org/10.1097/JOM.0000000000000977
Traxler, J., & Kukulska-Hulme, A. (Eds.). (2007). Mobile learning: A handbook for educators and trainers. Routledge. DOI: https://doi.org/10.4324/9780203003428
Wallerstein, I. (1974). The Modern World-System I Capitalist Agriculture and the Origins of the European World-Economy in the Sixteenth Century, With a New Prologue.
Wood, A. J., Graham, M., Lehdonvirta, V., & Hjorth, I. (2019). Good gig, bad gig: autonomy and algorithmic control in the global gig economy. Work, employment and society, 33(1), 56-75. DOI: https://doi.org/10.1177/0950017018785616
World Bank. (2019). World Development Report 2019: The Changing Nature of Work. World Bank Group.
World Development Report, 2016: digital dividends. (2016). Choice Reviews Online, 53(11), 53-4889-53–4889. DOI: https://doi.org/10.5860/CHOICE.196952
Copyright (c) 2024 Nazurah Abdul Malek
This work is licensed under a Creative Commons Attribution 4.0 International License.
Author (s) should affirm that the material has not been published previously. It has not been submitted and it is not under consideration by any other journal. At the same time author (s) need to execute a publication permission agreement to assume the responsibility of the submitted content and any omissions and errors therein. After submission of revised paper in the light of suggestions of the reviewers, the editorial team edits and formats manuscripts to bring uniformity and standardization in published material.
This work will be licensed under Creative Commons Attribution 4.0 International (CC BY 4.0) and under condition of the license, users are free to read, copy, remix, transform, redistribute, download, print, search or link to the full texts of articles and even build upon their work as long as they credit the author for the original work. Moreover, as per journal policy author (s) hold and retain copyrights without any restrictions.
