The Valuation of Flexible Work Arrangements : Insights from a Discrete Choice Experiment in Malaysia

The changing nature of work, accelerated by the experience of the COVID-19 pandemic, has resulted in several fundamental shifts in the terms and conditions of work. Along with the clear trend of increased nonstandard employment, including through the gig economy and platform work, this poses critical questions for policies and practices of the organization of work arrangements, and about who may bear the costs of emerging arrangements. This paper explores whether workers in freelancing and standard work arrangements in Malaysia view a trade-off between flexibility and income and are willing to forgo a share of earnings for greater flexibility. The paper deploys a novel discrete choice experiment in which respondents are asked to choose their preferred job from two hypothetical job descriptions with randomly assigned attributes, namely, flexibility and associated earnings. The findings show substantial but not overwhelming preference for greater flexibility, especially among freelancers, and a clear trade-off between measures of flexibility and income. The findings also show considerable variation in the preference for flexibility, much of which is not explained by worker demographics and other observable characteristics but is consistent with other measures of the importance attached to flexibility and earning income. The analysis outlines pathways through which offering even a modicum of flexibility can enhance workers’ utility without necessarily increasing costs for employers, provides evidence of considerable preference heterogeneity, and warns against imposing uniform approaches to (in)flexible work arrangements.