Digital Work: New Opportunities or Lost Wages?

Abstract

This paper investigates wages of online workers and workers in traditional workplaces to understand the effects of the online labor market on wages. Using BLS restricted microdata for 6,754,128 workers in traditional workplaces and wage data for 12,932 virtual workers in the US, I argue that characteristics of work that can be done virtually disproportionately affects more highly skilled workers, who have traditionally been more immune to globalization. I find that online work is not only a natural extension of the globalization of labor markets, but also introduces a new spatial restructuring of work that removes temporal and spatial constraints.