IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp17740.html
   My bibliography  Save this paper

Riders on the Storm

Author

Listed:
  • Dolado, Juan J.

    (Universidad Carlos III de Madrid)

  • Jáñez, Álvaro

    (Stockholm School of Economics)

  • Wellschmied, Felix

    (Universidad Carlos III de Madrid)

Abstract

Online food delivery platforms typically operate through a controversial business model that relies on subcontracting self-employed workers, known as riders. We quantify the labor-market effects of the Spanish Riders' Law in 2021 that established the presumption of dependent employment for riders using a search and matching model. Riders with heterogeneous preferences for leisure trade off work flexibility and easier employability as self-employed against enjoying higher wages as employees. Our main finding is that the reform led to a higher share of employees but failed to fully absorb the large flows of workers transiting out of self-employment and decreased riders' wages leading to welfare losses. However, complementing the reform with a payroll tax cut for platforms hiring employees preserves employment levels and increases riders' welfare.

Suggested Citation

  • Dolado, Juan J. & Jáñez, Álvaro & Wellschmied, Felix, 2025. "Riders on the Storm," IZA Discussion Papers 17740, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp17740
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp17740.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    riders; food delivery platforms; self-employed; employees;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp17740. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.