Digital Labour

Development Implications of Digital Platform Labour

A new paper – “Understanding the Development Implications of Online Outsourcing: A Study of Digital Labour Platforms in Pakistan” – analyses the experiences of some of the millions of gig workers who undertake digital labour in developing countries via platforms such as Upwork and Freelancer.

Using the sustainable livelihoods framework as the basis for analysis, it identifies four things from interviews with workers and other stakeholders in remote areas of Northern Pakistan:

a) Employment Push: The context of politico-economic vulnerability that pushes unemployed individuals into digital work including lack of alternative employment, political instability and concerns about Islamic extremism.

b) Barriers to Gig Work: The typical barriers to digital gig work for those in more remote areas of developing countries. These include poor quality of technical infrastructure such as power and broadband connectivity; a lack of relevant knowledge and skills or the means to obtain them; limitations of current financial payment systems; and cultural norms that do not see online freelancing as constituting a “job”.

c) Worker Trajectories: The four trajectories of digital gig workers who go through training schemes: sinkers (the majority who never undertake digital platform work), strugglers (who try but appear largely unable to make a living), survivors (who can earn small amounts from digital gig work), and swimmers (who flourish and are able to build a career path via digital platforms).

d) Role of Institutions: The “re-institutionalisation” of digital labour. Notwithstanding narratives of the de-institutionalisation of digital gig work, experience in Pakistan shows three institutional forces impinging on online outsourcing to marginalised groups. There are the digital platforms themselves; often seen as improving the context for outsourcing work.  There are interventions of formal organisations – development, government and NGO agencies – who help overcome asset deficits that would otherwise exclude these groups from online outsourcing.  And there are informal linkages between freelancers themselves which provide assistance and work sub-contracts.

Digital Economy

Defining, Conceptualising and Measuring the Digital Economy

It is generally understood that the digital economy in developing countries is growing, and growing fast.  But what is the digital economy, and how large is it?

A newly-released working paper from the University of Manchester’s Centre for Development Informatics – “Defining, Conceptualising and Measuring the Digital Economy” – addresses this question.  It was developed as part of the DIODE strategic network, which is funded by the UK’s Economic and Social Research Council as part of the Global Challenges Research Fund initiative.

“Digital economy” is typically dated back to Don Tapscott’s 1996 book of the same name.  It has been in fairly continuous use since, with a particular growth in interest in the past two-three years linked to resurgence of “digital” as a terminology.

Looking across the definitions, one can identify three scopes of definition as summarised in the figure below:

  • The core of the digital economy is the “digital sector”: more often called the “IT sector” or “ICT sector”, and based on the OECD definition of specific ICT-related manufacturing and services sub-sectors.
  • The “digital economy” as we define it is “that part of economic output derived solely or primarily from digital technologies with a business model based on digital goods or services”. It means the digital sector plus ICT-enabled business that extends the boundaries of economic activity.  The latter covers new digital business models such as platform-based firms.
  • A much wider scope encompasses all economic activity based on digital technologies; thus also including application of ICTs to intensify existing economic activity in manufacturing, services and primary production. We refer to this as the “digitalised economy”.

Digital Economy Three Scopes

Measuring the digital economy faces challenges of fuzzy boundaries, poor data quality, pricing problems, and invisibility of much digital activity.  But, reviewing the measures that are available, we estimate the digital economy as defined here to constitute around 5% of global GDP and 3% of global employment.

There is significant unevenness between and within regions.  For example, the digital economy likely constitutes a two-to-three times higher share of GDP in the global North than the global South.  Conversely, digital economy growth rates in the global South are estimated to be twice as fast as those in the global North.

Combined with higher-than-average wage and productivity levels, this points to the growing importance of the digital economy in developing countries.  Yet growth is constrained by a set of serious barriers and a lack of knowledge including policy guidance.  All this supports DIODE’s goal of strengthening the research base on digital economies in the global South.

Digital Enterprise

A Research Agenda on 3D Printing, FabLabs, Makerspaces, etc in the Global South

We hear a great deal about 3D printing, FabLabs, makerspaces, hackerspaces and the like.  They are emerging digital economy phenomena in the global South.  But what research has been done so far in this domain?  And what should the future research agenda be?

To answer those questions, Ryo Seo-Zindy – a doctoral researcher with Manchester’s Centre for Development Informatics – undertook a systematic literature review, which has been published as: “Researching the Emergence of 3D Printing, Makerspaces, Hackerspaces and FabLabs in the Global South: A Scoping Review and Research Agenda on Digital Innovation and Fabrication Networks” in The Electronic Journal of Information Systems in Developing Countries.

The review identified 70 papers of relevance (of which only a small minority covered the global South).  It found that the literature maps a complex and varied picture of actors, activities, locations, and technologies.  To link these all together, we propose the notion of “digital innovation and fabrication networks” (DIFNs).  We define a DIFN as “a network of people, technologies, enterprises and other organisations, which use digital fabrication tools and other digital technologies to produce and innovate products in an open, community- and workspace-based environment”.

Textual analysis of the 70 papers included creation of the wordcloud below.

DIFN Wordcloud

From this and other analysis, three overarching themes emerge from the literature.

i. Production:
– The idea of peer production as a new and collaborative mode for creation of digital artefacts and tools
– The rise of industrialised but small-scale production, using tools such as 3D printers

ii. Innovation:
– Support for grassroots, localised innovation often in physical workspaces
– Simultaneously, the emergence of new innovation intermediaries and hubs that link out into wider digital innovation ecosystems

iii. Openness:
– A cross-cutting theme within models of production and innovation, with a focus on re-usability, adaptability, and transparency
– But . . . beyond this, a vagueness or multiplicity of meanings around openness

Despite the work already undertaken, the rapid expansion of DIFNs in developing countries creates a growing series of knowledge gaps and, hence, a future research agenda.  The paper discusses these in detail, with an overview of some elements summarised in the table below.

Research Theme Future Research Agenda
Methodology ·      Extend use of conceptually-founded empirical research
·      Expand breadth of coverage to un-researched locations (Africa, Latin America, most of Asia), and expand depth of insight in East/South-East Asia
Production ·      Map the production processes taking place within DIFNs
·      Map the relationships and production models arising between DIFNs and local manufacturing
·      Analyse the tension between collaborative and individualised production within DIFNs
Innovation ·      Investigate how grassroots innovation, focused on local socio-economic problems, can be fostered
·      Examine the learning processes that occur between actors in DIFNs and the wider innovation system
Openness ·      Research the different types of openness seen in DIFNs
·      Analyse the competing worldviews that influence and are negotiated in DIFNs

Parts of this agenda are currently being taken forward with field research on DIFNs in South-East Asia.

Digital Enterprise

How Context Impacts Developing Country Digital Start-Ups

As the digital economy grows in developing countries, is it part of a “weightless economy” that floats free from the local context?  Or is it still heavily embedded within that context?

Recent research from Manchester’s Centre for Development Informatics investigates this. The paper, “Digital Start-Ups in the Global South: Embeddedness, Digitality and Peripherality in Latin America” looks at the experience of digital start-ups in the four largest economies of Latin America: Argentina, Brazil, Colombia and Mexico.  It does so through the lens of the Triple Embeddedness Framework (see below).

Geels TEF

The Triple Embeddedness Framework

Far from being free-floating, these young enterprises are strongly-rooted in local supply chains, social institutions, and policy environments.  But they also experience “hybrid embeddedness”, meaning they lie at the intersection of different domains:

  1. Product/Digital Hybridity. Digital start-ups are shaped by their product sector: the sector of the goods or services they sell – the financial services sector for an online investment start-up; the recruitment sector for a web-based employment exchange. But – unlike traditional enterprises – they are also embedded in an emergent digital sector.  Where their level of embeddedness in each sector is “just right” – what we called “Goldilocks embeddedness” – they can cross-fertilise ideas between the sectors, draw finance and staff from both sectors, and are not so heavily-embedded that their investment in the status quo constrains innovation.
  2. Local/Global Hybridity. Digital start-ups are also hybridly-embedded in both a local and a global industry regime. Local laws and social networks and capabilities are an essential part of these digital enterprises’ operations.  But they also take business models, start-up methodologies, social norms and policy priorities from the global North; primarily from Silicon Valley in the US.  Their position on the relative periphery of the global economy also seems helpful: it allows these ideas and other resources to flow in from the US but offers some relative protection from external competition.

Governments and firms in the global South need to recognise this pattern of embeddedness:

  • Governments must do more to build up local digital sector institutions which act as key intermediaries both within the local digital economy and between local and global digital economies.
  • Digital start-ups must self-analyse the constraints and freedoms imposed by their embeddedness. And they must customise models and methods from the global North; for example, rescoping the Lean Start-Up methodology to take a broader bi-sectoral and socio-political remit.

In research terms, we need to understand more about how the digitality and peripherality of these start-ups affects their development trajectories.  This and other items will form part of the DIODE Network discussions on future research agendas around development implications of digital economies.

DIODE General

DIODE Summary

As digital technologies – the internet, web, mobile phones, social networks, 3D printers, etc – spread around the world, both work and business are changing via creation of digital economies.

There has already been impact in developing countries: thousands of digital startups, millions working in the ICT sector, millions more undertaking online work for platforms like Upwork. And the potential is even greater: hundreds of millions could access online work platforms, digital businesses like Uber and Airbnb are spreading rapidly, demand for digital enterprises is high, 3D-printing could level the manufacturing playing field, etc. But problems are also arising: most digital startups and digital careers fail; most citizens are unable to participate in digital economies; the benefits of digital work and trade seem to flow more to big corporations in the global North than to workers, enterprises or governments in the global South.

The speed of change means much of this is happening in a knowledge vacuum. Researchers are playing catch-up to try to understand these new trends in the global North, but very little research on digital economies looks at developing countries or is done by researchers in those countries. As a result, there are four knowledge gaps about digital economies in the global South. We don’t know:
– what’s going on and where;
– the development impact e.g. whether digital economies are increasing or reducing inequalities;
– what governments, NGOs and businesses should be doing to create an effective “digital ecosystem” that works for the benefit of all.
And as researchers we are not sure what concepts and methods to apply.

The “Development Implications of Digital Economies” (DIODE) Strategic Network aims to help fill these knowledge gaps. It has three main objectives:
– To assess the current state-of-play and identify a future research agenda around the four knowledge gaps above.
– To create a research network with the capacities to implement this research agenda on digital economies and development.
– To develop specific research proposals that address identified research priorities.

The network consists of senior and junior researchers from the UK, developing countries and other locations around the world who – along with those working in digital economy policy and practice – will work together to fulfil these objectives. Following initial synthesis studies to understand the current state-of-play, we will meet in four workshops – two in developing countries, two in the UK – each of which will address particular knowledge gaps through presentations and working group sessions.

Alongside the network itself, by the end we will have produced a final report that provides a future research agenda; a strategy brief to guide those involved in digital economy policy/practice; and a set of research proposals that can put the agenda into practice.

Initially, the main beneficiaries will be network members: we will have a far better understanding of what to research next and how to research it, with stronger capacity to undertake this work, and dense contacts to ensure our research is relevant to policy and practice. We will have created research capacity within and between developing countries, so that work on this important and growing phenomenon can be driven from and undertaken in those countries.

GCRF and other researchers – especially in developing countries – will benefit from having a clear sense of research priorities and tools, but also from understanding how important digital economies are becoming in the global South. Digital economy policy-makers, entrepreneurs, worker organisations and other practitioners will understand what good-practice actions to take.

Through that policy/practice connection, and through the outputs from later implementing our research agenda, we will make a difference to development: helping ensure digital economies work to deliver development goals.