The Labor Economics of Paid Crowdsourcing

Proceedings of the 11th ACM Conference on Electronic Commerce, 2010

10 Pages Posted: 27 Apr 2010  

John J. Horton

New York University (NYU) - Department of Information, Operations, and Management Sciences

Lydia B. Chilton

University of Washington

Date Written: March 27, 2010

Abstract

We present a model of workers supplying labor to paid crowdsourcing projects. We also introduce a novel method for estimating a worker's reservation wage – the key parameter in our labor supply model. We tested our model by presenting experimental subjects with real-effort work scenarios that varied in the offered payment and difficulty. As predicted, subjects worked less when the pay was lower. However, they did not work less when the task was more time-consuming. Interestingly, at least some subjects appear to be “target earners,” contrary to the assumptions of the rational model. The strongest evidence for target earning is an observed preference for earning total amounts evenly divisible by 5, presumably because these amounts make good targets. Despite its predictive failures, we calibrate our model with data pooled from both experiments. We find that the reservation wages of our sample are approximately log normally distributed, with a median wage of $1.38/hour. We discuss how to use our calibrated model in applications.

Keywords: Labor Supply, Crowdsourcing, Experimentation, Amazon Mechanical Turk

JEL Classification: C93, J30

Suggested Citation

Horton, John J. and Chilton, Lydia B., The Labor Economics of Paid Crowdsourcing (March 27, 2010). Proceedings of the 11th ACM Conference on Electronic Commerce, 2010. Available at SSRN: https://ssrn.com/abstract=1596874

John J. Horton (Contact Author)

New York University (NYU) - Department of Information, Operations, and Management Sciences ( email )

44 West Fourth Street
New York, NY 10012
United States
6175952437 (Phone)

HOME PAGE: http://john-joseph-horton.com

Lydia B. Chilton

University of Washington ( email )

AC101 Paul G. Allen Center, Box 352350
185 Stevens Way
Seattle, WA 98195-2350

Paper statistics

Downloads
394
Rank
60,676
Abstract Views
2,540