When Stigma Doesn’t Transfer: Stigma Deflection and Occupational Stratification in the Sharing Economy

Research has suggested that when an occupation is stigmatized, new occupational members will assume the stigma of incumbents because stigma transfers. Yet, current research does not account for shifts in the modern workforce that are changing the nature of many stigmatized occupations. We argue that these changes raise questions about whether stigma will transfer to new occupational members. Drawing from a study of Uber’s entry into Toronto, Canada, we reveal the process by which stigma transfer can be avoided by new occupational members. We show how categorical ambiguity during entry enabled two sets of activities: creating categorical distinctiveness and showcasing identity discrepancies. These activities acted as mechanisms of stigma deflection by distancing Uber drivers from the taint associated with taxi drivers. However, this further entrenched the taint facing incumbents and stratified the occupation along a stigma faultline. We offer implications for research on stigma, market entry, and the sharing economy.