Basu Sharma.
Platform business are those business types that are assisted by Apps to mediate demand and supply. Unlike traditional linear business models where value is created through the creation of products or services that are sold to customers, platform-based business models are multi-sided with platform owners, customers, and service providers as the main players (Song, 2019; Rochet and Tirole, 2003). In this multi-sided market model, value is created through connecting participants on an online network, where the Internet and communications technology (ICT) serves as its backbone. The platform does not own the means of production but exploits the means of connection. Two of the important characteristics of this market are that it eliminates trade barriers using information sharing between different players and uses emerging technologies such as, artificial intelligence, machine learning, cloud computing, the Internet, and big data to create a competitive advantage. The platform business has been growing at a remarkably high rate, and its diffusion around the world has been rapid. Since cloud computing is ubiquitous and the Internet used globally, platform companies have created work systems that allow work to be distributed around the world. This development has given rise to a planetary labour market where tasks are performed by independent contractors. These contractors are not entitled to any employment protection such as unemployment benefits, pension, overtime premium and paid vacations because they are not classified technically as employees. They are self-employed, and considered solo entrepreneurs, or solopreneurs. In developing countries, the number of solopreneurs has been historically high due to the lack of formal, paid employment opportunities. In developed countries, informal employment was not as prominent as in developing countries due to the abundance of formal employment opportunities, until recently. However, the new platform business has begun to disrupt the old employment system and has contributed towards creating more solo entrepreneurs. That is to say, the platform economy has been adding “more momentum” to self-employment in developed economies (Klebe and Weiss, 2019). Consequently, there are convergence tendencies with respect to the rise of solo entrepreneurs in both developed and developing countries. The purpose of this paper is to explore this convergence hypothesis in specific reference to platform businesses and the evolution of a new entrepreneurial employment regime.
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Keywords: Three-sided market, solopreneurs, developing countries, convergence hypothesis
Author: Basu Sharma
Faculty of Management, University of New Brunswick, Canada
