OPERATIONS, TECHNOLOGY, AND INFORMATION MANAGEMENT


Should Gig Platforms Decentralize Dispute


Resolution? Manufacturing & Service Operations Management, 26, 2, March 2024 LINK TO PAPER


YAO CUI ASSOCIATE PROFESSOR


Samuel Curtis Johnson Graduate School of Management


Cornell SC Johnson College of Business Cornell University


Co-authors • Yao Cui


Associate Professor, Samuel Curtis Johnson Graduate School of


Management, Cornell SC Johnson College of Business, Cornell University • Wee Kiat Lee, Nanyang Technologcal University of Singapore


Summary Online labor platforms have experienced tremendous growth over the years,


accounting for more than 90% of net employment growth in the United States between 2005 and 2015. Disputes on these platforms have traditionally been mediated by the platform itself, which is often viewed as unhelpful or biased. However, there are emerging platforms that promise to resolve disputes with a novel tribunal system, relegating dispute resolution to individual platform users through a voting mechanism.


Te authors use game theory to examine the dispute resolution systems used by traditional platforms (i.e., the centralized dispute system) and emerging platforms (i.e., the decentralized dispute system). Tey find that the optimal adoption and implementation of the decentralized dispute system is more ef- fective for tasks that involve subjective evaluations, and that platforms should avoid strategies that homogenize the assessments of tribunal members. More- over, platforms should consider switching to the decentralized dispute system only if they are able to verify the skill level of freelancers through certification or other means. Lastly, the decentralized dispute system may be more appeal- ing to policy makers because of its potential to induce a more socially optimal outcome.


CONTENTS TO MAIN


| RESEARCH WITH IMPACT: CORNELL SC JOHNSON COLLEGE OF BUSINESS • 2024 EDITION


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