A policy paper drawing on case studies from around the world sets out a series of recommendations to develop a more democratic alternative to the gig economy.
Compiled by Trebor Scholz (Platform Cooperativism Consortium), Morshed Mannan (European University Institute), Jonas Pentzien (Institute for Ecological Economy Research), Hal Plotkin, senior policy advisor in Office of Under Secretary of Education, United States Department, 2009-2014) Policies for Cooperative Ownership in the Digital Economy argues that “governments on every level, from national to municipal, can take measures to empower platform co-operatives”.
This will provide more equitable alternative to the gig economy – which provides services through digital platforms like Uber, TaskRabbit, and GrubHub, acting as two-way intermediaries between workers and customers.
“While the gig economy has provided some convenience and savings to customers and flexibility to workers, the rise of the gig economy has also been disastrous,” says the report, which points to weakened worker protections, environmental conditions and public services.
With the Covid-19 crisis worsening these problems but also bringing a tightened labour market, the report says the world is now at a “critical juncture” when it comes to the online economy. “Many of these already unprofitable firms face a real danger of failure just as their aggressive expansion has weakened public infrastructure, leaving vital gaps in essential services,” it warns.
The solution, says the report – produced by the Platform Cooperativism Consortium and the Berggruen Institute, is the platform co-op model – “democratically governed organisations owned by workers, customers, and other stakeholders”.
The model is still in its early stages but the report says “platform co-operatives build on the proven business models of co-operatives to establish alternatives to the gig economy and its supporting digital infrastructure.
“Platform co-operatives are critical to creating a fairer economy and building back better from the pandemic.”
The report says the sector needs active government intervention at all levels to help it compete with well-funded and established private platforms.
Suggested measures include:
- Procurement policies to provide preferential treatment of platform co-ops over privately owned platforms
- Public solidarity lending to finance early-stage platform co-ops as part of national, regional, and municipal development strategies
- Public participation in multi-stakeholder co-ops via direct state ownership of co-op shares that provide a public voice in co-op management
- Legal research and review to ensure that laws governing co-ops reflect the changing realities brought by digital technology
- A system of public benefits available to the workers of platform co-ops such as healthcare, childcare, and worker training
- A network of public spaces that can be used explicitly by platform co-ops to serve as hubs
“The ultimate goal of these policy prescriptions,” says the report, “is to create a more level playing field for platform co-operatives by reducing the risks their members bear through the provision of collective goods.
“Such basic services allow alternative economic institutions to compete with often unprofitable platform companies flush with venture capital funds.”
The policy ideas in the report follow case studies made by the writers in seven locations around the world: California, USA; Kerala, India; Barcelona, Spain; Bologna, Italy; Berlin, Germany; Paris, France; Preston, UK.
From these locations it identifies a number of successful platform co-ops – such as Decidim, a participatory democracy platform used by 40,000 citizens in Barcelona and over 60 cities and organisations worldwide; Guifi.net, a community network started in the Catalonia and Valencian Community in Spain to provides internet access in
rural areas that internet service providers do not reach; NursesCan, a healthcare co-op launched with union backing in California.
It also highlights policy initiatives such as the UK’s Preston Model of community wealth building and the diversified economy of Italy’s Emilia Romagna region – home to 8,000 co-ops which constitute 40% of the region’s GDP.
And it points to the social value delivered by the model – for instance by integrating LGBTQ+ communities into the digital economy in Kerala, India; or encouraging ethical supply chains through ventures like Spanish agricultural co-op platform Katuma.
“We selected these localities because of the presence of platform cooperatives in their economies and to offer diverse geographical, legal, political, and economic perspectives,” adds the report. “Each case study examines
the status of platform co-operatives and corresponding government policies towards co-operatives and suggests specific improvements and additional actions that local and national authorities can pursue to foster a co-operative ecosystem.”