Could Online Gig Work Drive Economic Growth?

This policy paper is an attempt to understand the nature of the gig economy, its impact on labour productivity and income distribution, and policy interventions which are required by the government and central bankers when technology-aided gig works are spreading across the globe. From an economic perspective, the rise of the gig economy is likely to increase overall productivity. Increase in productivity arises from an increase in labour force participation and getting access to lower salaried workers from cross borders, leading to more specialization and standardization of work. At the same time, full-time employment in a gig type set up may lead to lower income and economic vulnerability of workers in developed countries. The government should also address the challenges associated with some workers getting displaced from technological disruption. There is a need to find ways to absorb these labourers for alternative employment. Governments can work closely with business and training centres to impart necessary additional skills for the displaced workers. At the same time, for the spread of gig works, there is a need to invest in ICT-related infrastructure such as telecommunication and internet connection.