Contextualising Digital Platforms in the Informal Economy: Policy and Reality in Jakarta, Indonesia

In recent years, many cities worldwide have witnessed a dynamic shift in their urban and economic landscapes, driven by the rapid rise of digital platforms that increasingly intersect with urban governance. A range of cases across the so-called “informal sector” (e.g., mobile money, motorcycle taxis and domestic work) evidence the growing popularity of the intersection of digital platforms and informality. However, existing literature provides little empirical material that sketches out concrete landscapes of how we can understand the expansion of digital platforms in specific real-life contexts of informality in a particular country. In response, this working paper presents a novel methodological approach to contextualise digital platforms in the informal sector, aiming to paint a broad picture of this emerging urban landscape. Specifically, it aims to convey the policy context and local atmosphere where digital platforms meet urban informality, sketching out the evolving regulatory dynamics and everyday use of digital platforms among local residents that are set in the context of informality.

From policy and regulation, via platform landscape (market and technology) to the context of informality, this working paper offers a useful methodological approach to understanding the intersection of digital platforms and urban informality alongside a lively local context, drawing mainly on document analysis and field observations undertaken in Jakarta, Indonesia. It finds that governments or policymakers are not so “inactive” in responding to the growing digital economy – both in terms of seizing the opportunity as well as addressing the challenges. It then provides a glimpse of how the policy gap is being (potentially) filled with the advent of digital platforms. The vignette of real-life experiences from the informal sector presented in the final section of the paper then gives us a hint as to what areas need attention in relation to platform policies.