Chile’s 2022 Platform Work Law mandates firms to monitor their subcontractors' formality and establishes maximum working hours, minimum pay, and the right to collective bargaining among independent contractors. Chile further stands out worldwide for providing a comprehensive and nationally representative dataset for platform work that allows us to track workers' labor market outcomes over 2020-2024. By means of DiD and event study regressions, we find that this reform induced an 8-percentage-point shift from the share of informal to formal subcontractors with no change in the share of employees. Moreover, there were no significant changes in collective bargaining, compliance with minimum pay and maximum hours, or wage differentials between employees and subcontractors. The changes in hiring practices and wages are consistent with a structural labor market model where firms hire employees and formal and informal subcontractors. The calibrated model also shows that the reform reduced platforms' profits, while strictly enforcing hours regulations would lead to very small welfare losses.

Monopsony power may be particularly strong in certain hierarchical occupations within firms, and production complementarities between occupations may amplify its adverse effects. To quantify this phenomenon, we extend a general equilibrium oligopsony model to include firm organization. Adding a management layer increases production workers’ productivity and overhead costs, so only high-productivity firms hire managers to expand production. Using Portuguese administrative data, we quantify the model and validate it against quasi-experimental evidence on demand-wage passthrough and minimum wage effects. Relative to the efficient economy, welfare losses from monopsony are 3.4 and 2.4 percent for managers and production workers, respectively. Monopsony is stronger over managers because they sort into larger firms, view f irms’ non-wage attributes as less substitutable, and are less likely to be bound by the minimum wage. Through production complementarities, managers’ monopsony alone explains one-fifth of the overall earnings losses from monopsony for production workers.

Digital platforms often subcontract self-employed workers. We develop an equilibrium labor market model to quantify Spain's 2021 Riders’ Law, which sanctions platforms for hiring self-employed couriers in the food delivery sector. Couriers in the model trade-off flexibility and employability as subcontracted against higher wages as employees. Counterfactual simulations show that, absent sanctions, one-fifth of employees would instead be self-employed. However, sanctions reduce welfare by lowering average hourly wages in the sector by 7 percentage points. We find that redistributing sanction revenue as lump-sum transfers to riders would offset most of these welfare losses.