Gig Economy and Corporate Investment : Evidence From The Online Delivery Platforms In China And Across The Globe

This paper studies how labor flexibility and mobility induced by the gig economy, affects corporate investment, by exploiting the staggered entry of the leading online delivery platforms into different cities in China and across the globe. The results show that, following the entry of delivery platforms, corporate capital expenditures drop, through an increase in wages and a decrease in firm employment. The effects are more pronounced for firms that are more labor-intensive and less innovative. Our findings provide evidence on the effect of the holdup problem in the labor market on corporate investment, and on the complementarity hypothesis of labor and physical capital