Abstract

This study aimed to address behaviors of food delivery and ride-hailing platforms, two local gig platforms. It argues that generating cross-network externality between demand and supply sides by imposing different price structures on them (two-sided market theory) may not be enough for understanding local gig platforms. Due to their local nature of service delivery operations, it is argued that to generate externality, these platforms should practically integrate the supply side and operate as if a firm, hence quasi-firm. By doing so, these platforms can utilize their service providers as if their own slack resources, hence quasi-slack. As quasi-slack, service providers exist outside these platforms. However, they can be called upon and committed to these platforms’ service delivery operations. Quasi-slack is made possible because these platforms can induce information asymmetry and truncate a range of decision choices available to their service providers, which can lead to more service deliveries and streams of data for enhancing their algorithms. These platforms get the demand side actively involved in the process by letting it generate customer ratings critical for nudging the supply side to accept more service requests from the demand side.