Gig Economy Regulation Meets Flexible Supply: Evidence from a Price Floor Policy in Indonesia
Coauthor: Rizki Siregar.
Reject and Resubmit, American Economic Journal: Economic Policy
We show how labor markets in the gig economy adjust to price regulations via flexible supply. Using comprehensive transaction data from a major ridesharing platform in Indonesia, we estimate the causal effects of a government-imposed price floor policy by exploiting an exogenous variation in its rollout. We find that, on average, the policy increases trip prices but does not significantly affect the overall transaction volume nor increase daily driver earnings or hourly wages. These effects are driven by an increased excess labor supply that reduces the number of transactions per driver. Increased excess supply lowers driver productivity by increasing the share of less productive drivers in the workforce and by reducing individual productivity through crowding. We identify a small transfer from consumers to drivers with a limited total welfare effect.
Spillovers and Adjustments under Information and Search Frictions in a Developing Online Marketplace
Coauthors: Syed Ali Hasanain and Adeel Tariq.
Revise and Resubmit, Journal of Economic Behavior and Organization
Online marketplaces have grown rapidly in developing countries, yet buyers and sellers still have limited information and face high search costs. In crowded online marketplaces, sellers can also promote their items by paying for better positioning on search results, depending on the information and search frictions they face. We study how price information affects pricing, advertising, transaction outcomes, and spillovers on a major online listing platform for used vehicles in Pakistan. We conduct a randomized controlled trial in which we provide price recommendations to a subset of sellers. We find that treated sellers set listing prices closer to our price estimates but reduce advertising, resulting in statistically insignificant effects on transaction outcomes. We also find positive spillover effects on page views and transaction outcomes. A conceptual framework and survey responses show that these effects are driven by differentially updated beliefs about demand and search frictions between directly treated and spillover sellers.
Beliefs, Signal Quality, and Information Sources: Experimental Evidence on Air Quality in Pakistan
Coauthors: Isra Imtiaz, Sanval Nasim, and Arman Rezaee.
Submitted
We study how information sources as a signal of service quality shape consumers' beliefs about and demand for air quality forecast services. We provide day-ahead SMS forecasts in Lahore, Pakistan, randomizing whether the forecast is attributed to the government or an NGO. Respondents do not have differential demand by the assigned source but believe the government's forecasts are worse than the NGO's. The results demonstrate that consumers expect lower accuracy from the government, have a limited willingness to pay for accuracy, and prefer the assigned source as they learn about its service quality.
"Pecuniary and Non-Pecuniary Costs of Accessing a Public Benefits Program and Distributional Consequences: Experimental Evidence from California," with Matthew Brooks and Collin Weigel (pilot in progress).
"Uncertainty and Frictions in Gig Work: Evidence via Conditional Income Guarantee Interventions," with Mitali Mathur and Aleksandr Michuda (pilot in progress).
"Heat Alerts and Electricity Consumption: Evidence from Japan," with Hideki Shimada.
"Messaging to Encourage Signup of Text Alerts for Air Quality," with Collin Weigel (intervention in progress).
"Distributional Consequences of Pre-Paid Electricity Metering: Evidence from Dhaka," with Debasish Das.