Paper short abstract:

How do digital transport platforms affect informal markets? We study transport systems in Lagos and Abuja as informal marketplaces: spaces where human labor is sold at a unit price. Drawing on Clifford Geertz’s work on 'bazaars', we examine platform economy processes in two Nigerian metropolises.

Paper long abstract:

As described by Geertz, contrary to competitive markets, informal marketplaces are characterized by high uncertainty of information and relative unpredictability of supply and demand which make the prices extremely volatile. Through clientalisation, clients (riders) establish continuing personal relationships with sellers (drivers) to reduce the information effort of finding the best price to quality arrangement. Clientalization builds on trust relationships that transcend a single transaction and allows for fair and equitable price negotiation (bargaining). Through clientelization and bargaining, each transaction (ride) is determined through the realities of a particular case rather than the general distribution of comparable causes. As a result, bazaars are characterised by high fragmentation of person-to-person transactions, low levels of capitalization, and a reliance on personal networks.

In this paper, we propose that platform economy distorts the information distribution of informal marketplaces: the rules imposed by the platforms reverse the information asymmetry between clients and drivers. We build on a recent mixed-method study of digital platforms in use (Uber and Bolt), comprising semi-structured interviews and ethnographic observations conducted in Lagos and Abuja between June and December 2022. We argue that, through information dispossession, platform economy disproportionately weakens the drivers’ position in the negotiation process. Through platforms, the client-seller (rider-driver) relationships become mediated, controlled, and manipulated by the algorithm. We propose that this type of asymmetric information that prioritizes the client is a fundamental part of the platforms’ neoliberal business model that capitalizes on the oversupply of labor currently experienced in most agglomerations in Sub-Saharan Africa.