Working Paper: CEPR ID: DP13885
Authors: Vyacheslav Fos; Naser Hamdi; Ankit Kalda; Jordan Nickerson
Abstract: This paper shows that the introduction of the "gig-economy" changes the way employees respond to job loss. Using a comprehensive set of Uber product launch dates and employee-level data on job separations, we show that laid-off employees with access to Uber are less likely to apply for UI benefits, rely less on household debt, and experience fewer delinquencies. Our empirical strategy is based on a triple difference-in-difference empirical model, comparing the difference in outcome variables 1) pre- and post-layoff, 2) before and after Uber enters a market, and 3) between workers with and without the ability to participate on the ride-sharing platform (car-owners inferred from auto credit histories). In support of our identification strategy, we find no apparent pre-existing difference in outcomes in the months leading up to Uber's entry into a market. Moreover, the effects are severely attenuated for workers with an auto lease, for whom the viability of participating on the ride-sharing platform is significantly reduced. Overall, our findings show that the introduction Uber had a profound effect on labor markets.
Keywords: gig economy; labor markets; unemployment insurance; household debt; credit delinquencies
JEL Codes: D10; E24; H53; J23; J65
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Uber's entry into local markets (L92) | laid-off employees with access to Uber are 48% less likely to apply for unemployment insurance (UI) benefits (J65) |
| Uber's entry into local markets (L92) | laid-off employees experience a 13% reduction in total outstanding debt (G51) |
| Uber's entry into local markets (L92) | reduction in delinquency rates among laid-off employees (J65) |
| laid-off employees with access to Uber (J63) | reduction in reliance on unemployment insurance (UI) (J65) |
| access to Uber (L92) | significant reduction in reliance on UI (J65) |
| ability to participate in ridesharing (R48) | observed outcomes for laid-off workers (J65) |