Cited by 1,354Digital Economy and Work TransformationLegal and Labor StudiesDigital Platforms and Economics

What Do Platforms Do? Understanding the Gig Economy

Vallas, Steven, Schor, Juliet B.·2020·Annual Review of Sociology

Abstract

The rapid growth of the platform economy has provoked scholarly discussion of its consequences for the nature of work and employment. We identify four major themes in the literature on platform work and the underlying metaphors associated with each. Platforms are seen as entrepreneurial incubators, digital cages, accelerants of precarity, and chameleons adapting to their environments. Each of these devices has limitations, which leads us to introduce an alternative image of platforms: as permissive potentates that externalize responsibility and control over economic transactions while still exercising concentrated power. As a consequence, platforms represent a distinct type of governance mechanism, different from markets, hierarchies, or networks, and therefore pose a unique set of problems for regulators, workers, and their competitors in the conventional economy. Reflecting the instability of the platform structure, struggles over regulatory regimes are dynamic and difficult to predict, but they are sure to gain in prominence as the platform economy grows.

AI snapshot

Written from the paper’s full text.

TL;DR

This review identifies four dominant metaphors for platform work—entrepreneurial incubator, digital cage, accelerant of precarity, and institutional chameleon—and argues each is partial. It proposes an alternative image: platforms as “permissive potentates” that externalize responsibility and control while retaining concentrated power, making them a distinct governance mechanism from markets, hierarchies, or networks.

Key findings

  • The literature is organized around four images: platforms as entrepreneurial incubators, digital cages, accelerants of precarity, and chameleons adapting to institutional environments; each contains partial truth but distorts platform affordances.
  • Platforms are best understood as a new governance mechanism: they delegate control over work methods, schedules, and performance evaluation while retaining authority over task allocation, data collection, pricing, and revenue collection—hence “permissive potentates.”
  • Platform work is highly heterogeneous; dependency status is a key determinant, with supplemental earners better able to refuse low-paying tasks and thus earn higher wages, exercise more autonomy, and report more satisfaction than dependent workers (Schor et al. 2019).
  • Regulatory and collective-action struggles are dynamic: examples include California’s Dynamex ruling and Assembly Bill 5, New York City’s minimum wage for drivers, a 2019 global ride-hail strike, and SMart, a freelancers’ cooperative with 35,000 members since 1998; Chen (2018) found 40% of Didi drivers in China used digital strategies such as bots or multiple phones to subvert the algorithm.

Methods

  • Design: a review article synthesizing sociological and related literature on the platform economy and gig work; no new primary data are collected.
  • Data/sample: published studies, reports, and legal/regulatory developments; the authors construct a typology of five platform work types—architects/technologists, cloud-based consultants/freelancers, offline gig workers, microtaskers, and aspirational labor/content producers.
  • Analysis: conceptual critique of four prevailing metaphors, development of the “permissive potentates” alternative, and review of regulatory struggles and a research agenda.

Limitations

  • The paper states that platforms are a nascent, highly dynamic, and unstable economic form whose future is difficult to foresee; it cannot predict whether the platform governance mechanism will prove stable or institutionalized.
  • The paper states that research is lopsided—abundant on service providers but much less on architects, technologists, and algorithmic design—and identifies understudied areas including systemic relations between conventional and platform economies, collective action, and alternative labor-condition strategies.
  • Evident from the text: as a review, it does not report a systematic search protocol or primary empirical tests; its conclusions are interpretive syntheses of existing scholarship and reported cases.

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Integrity signals

Registry

Crossref · 10.1146/annurev-soc-121919-054857

Cites

99 of 99 references verified0 citation errors · 0 not checkable

Statistics

Nothing to recompute.

Claims the paper makes

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  • Findingcitation
    § The Digital Cage

    40% of Didi drivers in China were using digital strategies such as bots or owning multiple phones to subvert the algorithm.

    “Chen's (2018) study of Didi drivers in China found that 40% were using digital strategies such as bots or owning multiple phones to subvert the algorithm.”
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  • Findingcitation
    § The Digital Cage

    Empirical studies have found that workers can develop forms of resistance, acting back on the technologies they confront.

    “Empirical studies have begun to find that workers can indeed develop forms of resistance, acting back on the technologies they confront.”
    Quote in the paperSubstantial claim
  • Findingcitation
    § The Digital Cage

    Delivery couriers also develop ways to resist algorithmic control.

    “There are similar findings among delivery couriers, who also develop ways to resist algorithmic control (AttwoodCharles 2019,Schor et al. 2019, Shapiro 2018).”
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  • Findingcitation
    § The Digital Cage

    Freelancers on UpWork have found ways of defeating the platform's reputational metrics by forming online alliances with clients to game the performance evaluation system.

    “For example, Rahman (2018) finds that freelancers on UpWork have found ways of defeating the platform's reputational metrics, essentially forming online alliances with clients to game the performance evaluation system.”
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  • Findingcitation
    § The Digital Cage

    Uber drivers deploy an array of tactics to evade the platform's rules.

    “Cameron's (2019) multicity study of Uber drivers showed that workers deploy an array of tactics to evade the platform's rules.”
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    Findingreasoning
    § Incubators of Entrepreneurialism

    Platforms have not to date fostered crowd-based capitalism or horizontal power configurations.

    “Nor have they to date.”
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    Findingcitation
    § The Digital Cage

    Such tactics have recently gained wider use.

    “Such tactics have recently gained wider use (Sweeney 2019).”
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    Findingnone given
    § CONCLUSION

    The literature contains four controlling images of labor platforms, each with weaknesses.

    “We identified four controlling images in the literature; however, each has weaknesses.”
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    Interpretationreasoning
    § ADVENT OF THE PLATFORM REVOLUTION

    There are abundant reasons for caution when generalizing about the nature and organization of platform work.

    “These and other considerations provide abundant reasons for caution when generalizing about the nature and organization of platform work.”
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    Premisecitation
    § ADVENT OF THE PLATFORM REVOLUTION

    Platform work includes gig workers whose services are engaged via platforms and generally performed offline, as in ride-hail, food delivery, home repair, and care work.

    “A third category is gig workers whose services are engaged via platforms and generally performed offline, as in ride-hail, food delivery, home repair, and care work.”
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    Interpretationnone given
    § ADVENT OF THE PLATFORM REVOLUTION

    Labor market dynamics and demand conditions vary across platform worker groups, with architects and technologists in chronically short supply and gig, microtasker, and unpaid content producers suffering from chronic excess supply.

    “Labor market dynamics and demand conditions vary across the groups, with architects and technologists being in chronically short supply and gig, microtasker, and unpaid content producers suffering from chronic excess supply, conditions that platforms often exacerbate with ongoing recruitment.”
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    Interpretationreasoning
    § The Digital Cage

    The first, entrepreneurial view exhibits elements of utopian thinking, and the second approach to platform work exhibits elements of dystopian thinking.

    “If the first, entrepreneurial view exhibits elements of utopian thinking, the opposite charge can be leveled at the second approach to platform work.”
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    Interpretationnone given
    § Abstract

    Platforms externalize responsibility and control over economic transactions while still exercising concentrated power.

    “as permissive potentates that externalize responsibility and control over economic transactions while still exercising concentrated power.”
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    Premisecitation
    § Incubators of Entrepreneurialism

    In the presence of network effects, platforms can scale, dominate markets, and gain enough monopoly power to dictate conditions of exchange or develop monopsonistic positions in their labor markets.

    “In the presence of network effects, platforms can scale, dominate markets, and gain enough monopoly power that they can dictate conditions of exchange or develop monopsonistic positions in their labor markets (Dube et al. 2018, Khan 2017).”
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    Interpretationcitation
    § INTRODUCTION

    Platforms represent a shift from closed to open employment and a consequent retreat from direct control.

    “In particular, we focus on the shift from closed to open employment and the consequent retreat (Schor 2020) from direct control that platforms represent.”
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    Premisecitation
    § The Digital Cage

    Workers often devise tactics that enable them to evade, defy, or subvert the dictates of the assembly line.

    “Yet as industrial sociology eventually revealed, workers often devise tactics that enable them to evade, defy, or subvert the dictates of the assembly line (Hamper 1991).”
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    Premisecitation
    § ADVENT OF THE PLATFORM REVOLUTION

    Platform work includes architects and technologists of the platforms, who are founders, highly skilled employees, and independent contractors.

    “The first category includes the architects and technologists of the platforms, who are founders, highly skilled employees, and independent contractors.”
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    Interpretationnone given
    § ADVENT OF THE PLATFORM REVOLUTION

    Workers stand in different relations to the platform architecture, with architects serving as active designers while microtaskers and many gig workers are mainly passive recipients or users of the platform's affordances.

    “Furthermore, workers stand in different relations to the platform architecture, with architects serving as active designers (digital orthopedists), while others (microtaskers and many gig workers) are mainly passive recipients or users of the platform's affordances.”
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    Interpretationreasoning
    § Incubators of Entrepreneurialism

    It is unlikely that platforms will foster crowd-based capitalism or lead power and control to assume horizontal, peer-based configurations.

    “it is unlikely that platforms will foster crowd-based capitalism or lead power and control to assume horizontal, peer-based configurations.”
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    Premisecitation
    § ADVENT OF THE PLATFORM REVOLUTION

    Platform work includes microtasking performed entirely online, as represented by workers engaged on Amazon Mechanical Turk or Figure Eight.

    “A fourth type of platform work is performed entirely online, involving what is termed microtasking, as represented by workers engaged on Amazon Mechanical Turk (AMT) or Figure Eight (formerly CrowdFlower).”
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    Interpretationreasoning
    § Abstract

    Struggles over regulatory regimes are dynamic and difficult to predict, but they are sure to gain in prominence as the platform economy grows.

    “Reflecting the instability of the platform structure, struggles over regulatory regimes are dynamic and difficult to predict, but they are sure to gain in prominence as the platform economy grows.”
    Quote in the paperNot a substantial claim
    • Rests on an assumption: The platform economy will continue to grow.
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    Interpretationreasoning
    § INTRODUCTION

    Each of the four major metaphors of platform work contains a partial truth but also exhibits elements of distortion concerning the affordances that platforms actually exhibit.

    “Subjecting these images to critique, we find that while each contains a partial truth, each also exhibits elements of distortion concerning the affordances that platforms actually exhibit.”
    Quote in the paperSubstantial claim
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    Premisecitation
    § ADVENT OF THE PLATFORM REVOLUTION

    Platform work includes cloud-based consultants or freelancers who offer professional services via platforms such as UpWork or Freelancer.

    “A second type of platform work is performed by cloud-based consultants or freelancers who offer professional services via platforms such as UpWork or Freelancer.”
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    Interpretationnone given
    § ADVENT OF THE PLATFORM REVOLUTION

    Platform work varies over time, owing to frequent changes in algorithmic designs, market conditions, and regulatory policy.

    “Platform work also varies over time, owing to frequent changes in algorithmic designs, market conditions, and regulatory policy.”
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    Interpretationnone given
    § Permissive Potentates

    Platforms represent a nascent and highly dynamic economic form characterized by high levels of instability whose future is difficult to foresee.

    “we caution that platforms represent a nascent and highly dynamic economic form characterized by high levels of instability whose future is difficult to foresee.”
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    Interpretationcitation
    § Permissive Potentates

    Platforms selectively incorporate features of prior economic structures, generating a type of governance mechanism qualitatively distinct from its precursors.

    “While platforms incorporate many of the features of prior economic structures-markets, hierarchies, and networks (Powell 1990)-they do so selectively, generating a type of governance mechanism that is qualitatively distinct from its precursors (Aneesh 2009, Kornberger et al. 2017).”
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    Interpretationreasoning
    § Accelerants of Precarity

    The third image of platform work is more cautious about the transformative nature of institutional shifts.

    “By contrast, the third image of platform work is more cautious about the transformative nature of institutional shifts.”
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    Interpretationnone given
    § Accelerants of Precarity

    The first two images of platform work share the premise that labor platforms represent novel entities that signal a dramatic break with prior forms of work organization and economic activity.

    “However different they are from one another, the first two images share the premise that labor platforms represent novel entities that signal a dramatic break, or rupture, with prior forms of work organization and economic activity.”
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    Premisecitation
    § Permissive Potentates

    The labor process acquires a new geometry in which control is radically distributed while power remains centralized.

    “In effect, the labor process acquires a new geometry, in which ' control is radically distributed, while power remains centralized' (Kornberger et al. 2017, p. 79, emphasis added).”
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    Interpretationcitation
    § Permissive Potentates

    Although platforms create value, their profits often depend on the ability to externalize costs that conventional firms must pay, a form of free riding.

    “Although platforms do create value-for example, by enabling more efficient operations and exchanges-their profits often depend on the ability to externalize the costs that conventional firms must pay (a form of free riding; see Schor et al. 2019).”
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    Premisecitation
    § Permissive Potentates

    Some platforms benefit from network effects, producing concentrated markets and user lock-in, or from harvesting user data as a collateral source of value.

    “Some platforms also benefit from network effects, producing the concentrated markets and user lock-in that investors find so attractive, or from the harvesting of user data as a collateral source of value (see Rosenblat 2018; Srnicek 2016; Zuboff 2015, 2019).”
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    Premisecitation
    § Accelerants of Precarity

    The effect of this trend is to commodify labor time and disembed the worker from prior systems of social protection.

    “The effect, initially evident in temporary work and subcontracting, is to commodify labor time and disembed the worker from prior systems of social protection (Polanyi 1944, Wood et al. 2019).”
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    Interpretationcitation
    § Accelerants of Precarity

    Platform earnings may decrease precarity and compensate for poor benefits or low wages in primary jobs or help reduce debt or build savings.

    “In such cases, platform earnings may actually decrease precarity and compensate for poor benefits or low wages in primary jobs or help reduce debt or build savings (Schor et al. 2019).”
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    Interpretationreasoning
    § Permissive Potentates

    The platform firm retains authority over allocation of tasks, collection of data, pricing of services, and collection of revenues, but cedes control over specification of work methods, work schedules, and performance evaluation.

    “The platform firm retains authority over important functions-the allocation of tasks, collection of data, pricing of services, and of course collection of revenues-but it cedes control over others, such as the specification of work methods, control over work schedules, and the labor of performance evaluation.”
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    Interpretationnone given
    § Permissive Potentates

    Platforms represent a distinctively new form of economic activity.

    “we contend that platforms represent a distinctively new form of economic activity.”
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    Premisecitation
    § Accelerants of Precarity

    Dependency status, how reliant platform workers are on earnings for basic living expenses, is a key determinant of outcomes.

    “Schor et al. (2019) have argued that dependency status (i.e., how reliant platform workers are on their earnings to pay their basic living expenses) is a key determinant of outcomes”
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    Premisecitation
    § Accelerants of Precarity

    Supplemental earners earn higher wages, exercise more autonomy over their conditions of work, and are more satisfied than dependent platform workers.

    “Thus, they earn higher wages, exercise more autonomy over their conditions of work, and are more satisfied than those who are dependent (Schor et al. 2019).”
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    Interpretationnone given
    § The Digital Cage

    Algorithmic controls can and do inscribe managerial interests.

    “There is little question that algorithmic controls can and do inscribe managerial interests.”
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    Interpretationnone given
    § PLATFORMS AND THE SHARING ECONOMY: AN AGENDA FOR RESEARCH

    In ridehail and delivery, local provisioning means the absence of network effects and should make small cooperative entities viable.

    “In ridehail and delivery, local provisioning means the absence of network effects and should make small cooperative entities viable.”
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    Premisenone given
    § PLATFORMS AND THE SHARING ECONOMY: AN AGENDA FOR RESEARCH

    SMart and Stocksy engage high-skilled earners.

    “SMart and Stocksy engage high-skilled earners.”
    Quote in the paperNot a substantial claim
    • Rests on an assumption: SMart is a freelancers' cooperative with 35,000 members.
    • Rests on an assumption: SMart has been functioning since 1998.
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    Premisereasoning
    § CONCLUSION

    These analysts tend to share a common narrative.

    “They tend to share a common narrative.”
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    Interpretationcitation
    § Permissive Potentates

    Platforms transform the employment relationship by relinquishing control over selection, work methods, schedules, and performance evaluation, offering an open employment relation.

    “By contrast, platforms typically relinquish control over these processes, offering an open employment relation that greatly relaxes personnel selection criteria and affords workers considerable autonomy over when and how often to work (Schor et al. 2019).”
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    Study design and conductnone given
    § DISCLOSURE STATEMENT

    The authors are not aware of any affiliations, memberships, funding, or financial holdings that might be perceived as affecting the objectivity of this review.

    “The authors are not aware of any affiliations, memberships, funding, or financial holdings that might be perceived as affecting the objectivity of this review.”
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    Interpretationreasoning
    § CONCLUSION

    From the point of view of labor and the future of work, platforms should be thought of as a new economic form, distinct from markets, firms, and networks.

    “We have added a fifth, which contends that from the point of view of labor and the future of work, platforms should be thought of as a new economic form, distinct from markets, firms, and networks.”
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    Premisecitation
    § CONCLUSION

    Most of these accounts feature the superplatform future as one of superexploitation, surveillance, and even more powerful corporate rule.

    “Most of these accounts feature this future as one of superexploitation, surveillance, and even more powerful corporate rule (Frenken 2017; Kenney & Zysman 2016, 2019; Pasquale 2016; Srnicek 2016).”
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    Premisecitation
    § PLATFORMS AND THE SHARING ECONOMY: AN AGENDA FOR RESEARCH

    Stocksy United, a platform cooperative, resulted in better economic conditions and more satisfaction for its photographers.

    “Sulakshana et al. (2018) found that Stocksy United, a platform cooperative, resulted in better economic conditions and more satisfaction for its photographers.”
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    Premisecitation
    § CONCLUSION

    Numerous analysts have attempted to predict the future of platforms.

    “numerous analysts have attempted to predict the future of platforms (Frenken 2017; Kenney & Zysman 2015, 2016; Pasquale 2016; Scholz 2016b; Schor 2020; Srnicek 2016).”
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    Interpretationnone given
    § CONCLUSION

    The stability of the current platform configuration remains in doubt.

    “However, as we noted, the stability of the current configuration remains in doubt”
    Quote in the paperNot a substantial claim
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  • The paper relies on this without support.

    The platform economy will continue to grow.

    “as the platform economy grows”
  • The paper relies on this without support.

    Extracting profit from workers requires potent mechanisms of control.

    “The history of capitalism suggests that extracting profit from workers requires potent mechanisms of control.”
  • The paper relies on this without support.

    Labor platforms have established themselves as important players in domestic and increasingly global labor markets.

    “Originally considered a curious novelty, labor platforms have now established themselves as important players in domestic and, increasingly, global labor markets.”
  • The paper relies on this without support.

    SMart is a freelancers' cooperative with 35,000 members.

    “In Europe, SMart, a successful freelancers' cooperative with 35,000 members, has been functioning since 1998.”
  • The paper relies on this without support.

    SMart has been functioning since 1998.

    “In Europe, SMart, a successful freelancers' cooperative with 35,000 members, has been functioning since 1998.”
  • The paper relies on this without support.

    In carework, agencies capture rents for reputational assurance.

    “The hope is that coops can also improve conditions for lower-wage workers in occupations such as carework, where agencies capture rents for reputational assurance, and housecleaning, where informality reigns.”
  • The paper relies on this without support.

    In housecleaning, informality reigns.

    “The hope is that coops can also improve conditions for lower-wage workers in occupations such as carework, where agencies capture rents for reputational assurance, and housecleaning, where informality reigns.”
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Claims other papers make about this one

Each is checked against this paper’s own text: does it say what the citing paper says it does?

  • Online gig platforms can automatically match clients and workers, streamline transactions, and manage reviews, tasks that overlap with middle-skilled workers' duties.

    “Online gig platforms can automatically match clients and housekeeping workers, streamline transactions, and manage reviews (Vallas and Schor 2020), tasks that heavily overlap with the duties of incumbent middle-skilled workers.”

    From Skill-Biased Technical Change, Again? Online Gig Platforms and Local Employment (2025) · cites this paper as Vallas and Schor 2020

    In “ADVENT OF THE PLATFORM REVOLUTION” (page unavailable), the paper describes gig workers engaging with customers through platforms and describes digitally mediated transactions. In “PLATFORMS AND THE SHARING ECONOMY: AN AGENDA FOR RESEARCH” (page unavailable), it discusses customer reviews and ratings. These passages support the general platform functions, but do not establish that platforms automatically match housekeeping workers with clients or streamline their transactions. The statement about middle-skilled workers follows the citation and is not assessed as attributed to this source. (LLM, conf=0.82)

    Experimental — accuracy not yet measured
  • Recent studies recognize gig platforms as catalysts for entrepreneurial ventures.

    “This perspective is supported by several recent studies that recognized gig platforms as catalysts for entrepreneurial ventures (e.g., Barrios et al. 2020, Vallas andSchor 2020).”

    From Skill-Biased Technical Change, Again? Online Gig Platforms and Local Employment (2025) · cites this paper as Vallas and Schor 2020

    In “Incubators of Entrepreneurialism” (page unavailable), Vallas and Schor describe the view that platforms lower barriers and enable people to earn from their assets. They acknowledge some truth in that view but argue that platforms are unlikely to foster the envisioned crowd-based capitalism. The claim omits this substantial qualification. (LLM, conf=0.84)

    Experimental — accuracy not yet measured
  • Online gig platforms lower entry barriers for workers and thereby promote self-employment opportunities.

    “Third, online gig platforms lower barriers for workers to enter the job market, thus promoting selfemployment opportunities (Vallas and Schor 2020).”

    From Skill-Biased Technical Change, Again? Online Gig Platforms and Local Employment (2025) · cites this paper as Vallas and Schor 2020

  • Differences across platform work types include the level of skill, the spatial dispersion of the work, and the nature of the employment relation.

    “Differences across these types include the level of skill, the spatial dispersion of the work (Vallas and Schor 2020) and the nature of the employment relation.”

    From Dependence and precarity in the platform economy (2020) · cites this paper as Vallas and Schor 2020

  • Many platform workers use the work to complement income, and precarisation through platform work is far from a universal trend.

    “Vallas and Schor reject an assumed view of platform workers that is overly homogeneous.Many platform workers in fact use the work to complement income, precarisation through platform is far from a universal trend.”

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Cited by

Sorted by citations

Authors
Vallas, S., & Schor, J. B.
Affiliations
  • Northeastern University (US)
  • Boston College (US)
Venue
Annual Review of Sociology
Published
2020-07-30
Volume
46
Issue
1
Pages
273-294
ISSN
  • 0360-0572 (ISSN-L)
  • 1545-2115
OpenAlex
W3019960341
Cited by
1,354
References
102
Citations by year
2026: 291 · 2025: 279 · 2024: 264 · 2023: 231 · 2022: 169 · 2021: 95 · 2020: 23 · 2019: 1 · 2018: 1
FWCI
22.76
Type
journal article
Language
en
Open access
closed
Locations
Annual Review of Sociology (publishedVersion)
Topics
  • Social Sciences › Sociology and Political Science › Digital Economy and Work Transformation
  • Social Sciences › Business, Management and Accounting › Industrial relations › Legal and Labor Studies
  • Social Sciences › Business, Management and Accounting › Strategy and Management › Digital Platforms and Economics
Keywords
platform economy, platform work, gig economy, nature of work, employment, precarity, business incubators, governance mechanisms, platform regulation, concentration of power, economic transactions

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