Exploring the economics of the gig economy: legal arbitrage and employment law

At first glance, platforms are but a small cog in the gig economy, pairing consumers looking for a particular service with a suitable entrepreneur willing to complete the task. Algorithms take into account a wide range of relevant factors, from the quality of previous work and current availability to geographic location, and optimise the quality of each match - before charging a small fee for the service. Upon closer inspection, however, platforms’ role goes far beyond mere match-making. Instead, they offer Digital Work Intermediation: in order to deliver tightly curated products and services to customers, gig economy operators actively shape the entire transaction through close control over their workers. Whilst elements of work in the on-demand economy might not look like traditional ‘9-to-5’ jobs with a single employer, the reality of work is often a far cry from the freedom and independence of genuine entrepreneurship. As a result, the services offered to consumers are considerably more than a simple one-off match, from quality monitoring to payment facilitation.