The Hidden Costs and Benefits of Monitoring in the Gig Economy

Abstract

Monitoring is ubiquitous in the gig economy wherein the workforce is geographically dispersed. However, workers are often reluctant to be monitored because of privacy concerns, resulting in a hidden economic cost for employers as workers demand higher wages for monitored jobs. We investigate how three common dimensions of monitoring affect workers’ willingness to accept monitored jobs through online experiments on two gig economy platforms. The three dimensions of monitoring are intensity (how much information is collected), transparency (whether the monitoring policy is disclosed to workers), and control (whether workers can remove sensitive information). We find that, as the monitoring intensity increases, workers become less willing to accept monitoring because of elevated privacy concerns. Furthermore, being transparent about the monitoring policy increases workers’ willingness to accept monitoring only when the monitoring intensity is low. Interestingly, providing control over high-intensity monitoring does not significantly reduce workers’ privacy concerns, rendering this well-intentioned policy ineffective. Finally, females are more willing to accept monitored jobs than males as they perceive higher payment protection from monitoring and have lower privacy concerns. On average, the hourly wage compensation required for gig workers to accept monitoring is 1.6∼1.8 dollars, which amounts to roughly 28.6%∼37.5% of their average hourly wage.