The ruble collapse in an online marketplace: Some lessons for market designers
John J. Horton, Anand Shah, Peyman Shahidi
Status: R&R at Journal of Labor Economics
Last updated: 2021-04
Summary
The sharp devaluation of the ruble in 2014 increased the real returns to Russians from working in a global online labor marketplace, as con- tracts in this market are dollar-denominated. Russians clearly noticed the opportunity, with Russian hours-worked increasing substantially, primarily on the extensive margin – incumbent Russians already active were fairly inelastic. Contrary to the predictions of bargaining models, there was little to no pass-through of the ruble price changes in to wages. There was also no evidence of a demand-side response, with buyers not posting more “Russian friendly” jobs, suggesting limited cross-side externalities. The key findings – a high extensive margin elasticity but low intensive margin elasticity; little pass-through into wages; and little evidence of a cross-side externality – have implications for market designers with respect to pricing and supply acquisition.
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Cite
@unpublished{horton2021therublecollapseinanonlinemarketplacesomelessonsformarketdesigners,
title = {{The ruble collapse in an online marketplace: Some lessons for market designers}},
author = {Horton, John J. and Shah, Anand and Shahidi, Peyman},
year = {2021},
url = {https://john-joseph-horton.com/papers/the-ruble-collapse-in-an-online-marketplace-some-lessons-for-market-designers/}
}