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The Ruble Collapse in an Online Marketplace: Some Lessons for Market Designers

John Horton

No 28702, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The sharp devaluation of the ruble in 2014 increased the real returns to Russians from working in a global online labor marketplace, as contracts 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.

JEL-codes: J01 (search for similar items in EconPapers)
Date: 2021-04
New Economics Papers: this item is included in nep-cis, nep-lab and nep-tra
Note: LS
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Citations: View citations in EconPapers (1)

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