The “Make or Buy” Dilemma in the Gig Economy era: A Transaction Cost Approach to Upwork and Amazon Mechanical Turk

Abstrakt

Over the last decade, the world experienced an exponential growth in numbers and importance of On-Demand platforms, those digital marketplaces that match independent workers with companies or individuals in need of services. Known as Gig Economy, the phenomenon is disrupting the current way of doing business, by offering enormous opportunities to companies and individuals as well as exposing them to significant risks and concerns. The forecasted impact Gig Economy will have in 2020 is comparable to an increase of 2% in global GDP, turning it to be a “hot topic” in current researches and academic papers. Despite the vast contributions scholars carried out on the implications the phenomenon will determine, little is known on the triggers that push companies to recur to On-Demand platforms. The contribution of this thesis, therefore, lies in understanding Gig Economy from a company perspective, with the aim of finding out the circumstances in which firms choose freelancers rather than employees. Beyond being an interesting topic, the work will explore the potentials of Gig Economy, its value offering and its relevance in the nowadays and future scenarios, moving the research on the field a step ahead. The main theoretical foundation the author will adopt is Transaction Costs Economics while the means by which the study will be conducted is the analysis of the daily usage of the two most commonly utilized On-Demand platforms i.e. Amazon Mechanical Turk and Upwork. Keywords: Gig Economy, On-Demand Platforms, Crowd work, Transaction Cost Economics, Amazon Mechanical Turk, Upwork