Labor formalization and digital platforms: entrepreneurship and short-term rentals in Havana's housing markets

Despite shortcomings, economic formalization is still a sought-after set of policies expected to foster entrepreneurial activity among informal workers, in a way that would allow them to capitalize on their assets. The increasing presence of digital platform markets has moved enthusiastic governments and policy circles to seek new opportunities in the form of digital labor through platforms that reduce costs for the peer-to-peer exchange of good and services. I explore how digital platforms can disrupt labor formalization in traditional markets in Havana, Cuba, between 2015 and 2017, particularly how short-term rentals result in new dynamics among emerging landlords in short- and long-term rental markets. Through an in-depth qualitative approach to the informalities in digital platform markets, my findings suggest that the wedge between short-term and long-term rental landlords is defined by the social ties that determine the possibilities of market entry, resulting in greater economic and social inequities, rendering platform technologies as sources of disruption that could hinder the goals of economic formalization.

Automated summary

Despite its shortcomings, economic formalization is still a set of policies that is expected to foster entrepreneurial activity among informal workers and allow them to capitalize on their assets.