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Can Reputation Discipline the Gig Economy? Experimental Evidence from an Online Labor Market

Author

Listed:
  • Benson, Alan

    () (University of Minnesota)

  • Sojourner, Aaron J.

    () (University of Minnesota)

  • Umyarov, Akhmed

    () (University of Minnesota)

Abstract

In two experiments, we examine the effects of employer reputation in an online labor market (Amazon Mechanical Turk) in which employers may decline to pay workers while keeping their work product. First, in an audit study of employers by a blinded worker, we find that working only for good employers yields 40% higher wages. Second, in an experiment that varied reputation, we find that good-reputation employers attract work of the same quality but at twice the rate as bad-reputation employers. This is the first clean, field evidence on the value of employer reputation. It can serve as collateral against opportunism in the absence of contract enforcement.

Suggested Citation

  • Benson, Alan & Sojourner, Aaron J. & Umyarov, Akhmed, 2015. "Can Reputation Discipline the Gig Economy? Experimental Evidence from an Online Labor Market," IZA Discussion Papers 9501, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp9501
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    References listed on IDEAS

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    More about this item

    Keywords

    labor; personnel; contracts; online labor markets; job search; screening; reputation; online ratings;

    JEL classification:

    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • M55 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Labor Contracting Devices
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • K12 - Law and Economics - - Basic Areas of Law - - - Contract Law
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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