Browsing by Subject "market concentration"

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  • Bassett, Eli (Helsingin yliopisto, 2020)
    The platform economy has emerged in the past two decades to become a remarkably profitable and increasingly global industry. The explosive growth of platform firms can be attributed to the outsourcing of almost all aspects of business operations to minimize costs. This is coupled by their motivation to grow rapidly to capture disproportionately large market shares. Consequently, platform firms have become global behemoths, and the labor which sustains their growth has come to be known as “gig work”, in which self-employed contractors work whenever they please, without the traditional protections provided to formal employees. The goal of this dissertation is to explain these mechanisms in relation to their potential impacts on income inequality. This dissertation tests two hypotheses: the outsourcing hypothesis and market concentration hypothesis. Each hypothesis proposes a causal chain whereby outsourcing and market concentration in the platform economy lead to disproportionate economic power and greater economic insecurity, and consequently links these outcomes to a double movement in the U.S. income distribution. Methodologically, this research employs contrastive comparisons, whereby exemplary platforms are compared with their traditional competitors, namely Uber with the taxi industry, Amazon with Walmart, and DoorDash with Domino’s Pizza. From these contrastive comparisons, evidence is gathered to demonstrate key differences between platforms and their traditional competitors. Additionally, this research is contextualized in terms of historical and ideological trends, particularly the gradual re-emergence of income inequality and the development of neoliberal hegemony. The findings demonstrate that through unique combinations of the hypothesized mechanisms, platform businesses do proliferate greater economic insecurity, and generate disproportionate economic power between platform providers and platform managers and owners. However, evidence directly linking these outcomes to downward or upward pulls in the U.S. income distribution remains inconclusive. That said, substantial evidence was found for the rejection of the outsourcing hypothesis. Evidently, given the complexity of social systems, the findings from this research may be inherently difficult to generalize on a global or systemic level. As such, I conclude that further research is necessary to draw more decisive and generalizable conclusions regarding the interplay between income inequality and the platform economy.