Deskilling technology affords work amenity, increases labor supply

Abstract Research Summary We investigate how deskilling technology (map apps) affects the choice of individuals to provide ride‐hail service. In a vignette experiment, technology increased participation in work by 8% and 4% among low‐ and high‐skill drivers respectively. Technology can increase participation by raising productivity or affording an amenity (reducing disutility of work). A field experiment revealed that the technology afforded more amenity to low‐skill drivers and they incurred more stress when driving without technology. Strategically, the amenity is important as it may reduce wage pressures. Managerial Summary Technologies that deskill work may afford an amenity by reducing the disutility of work. In formulating technology strategy, managers must consider how the amenity varies by worker skill and how it affects the supply of labor. In the context of ride‐hail drivers, we show that navigation technology affords an amenity. The amenity is larger and the effect of technology on increasing labor supply is more pronounced among drivers with less skill. Strategically, the amenity is important as it may reduce pressures for higher wages from low‐skilled workers.