On-demand staffing platform contracts under asymmetric permanent staff information

Abstract

Abstract In the paper, we consider an on-demand staffing platform that assign temporary workers to employers in need. The employers would inflate the number of their permanent staffs to engage temporary workers from the platform at a lower discount. We design a contract for the platform to make the employer reflect his real quantity information. Specifically, we investigate a platform who provides on-demand staffing services and an employer (or a company) with some permanent staffs and uncertain demand for workers. Our results reveal that the trade between the platform and the employer takes place if and only if the number of permanent workers reported by the employer is lower than a threshold. In particular, the optimal contract can make the platform and the employer reach the first-best coordination when the employer reports that there are no permanent workers.