AI art in the gig economy: Investigating the effects of non-copyrightability in online labor markets

As generative AI continues to transform industries, including the creative sector, it has become critical to understand how it interacts with legal frameworks. This study aims to investigate the effect of the landmark ruling issued by the U.S. District Court on August 18, 2023, which declared AI-generated art uncopyrightable to provide clarity to previously ambiguous legal standards on the AI-related services in online labor markets. Our findings reveal that prices for AI-related gigs on an online freelancer platform dropped by 32.97 % following the ruling, suggesting that the lack of copyright may have reduced the perceived value by limiting clients' residual rights. Furthermore, our research indicates that both freelancer experience and communication efficiency significantly moderate the relationship between AI art non-copyrightability and project pricing. In addition, the results show that large corporate clients were more affected by the ruling than individual clients. In contrast, prices for projects commissioned by small and mid-sized corporate clients did not change significantly. This suggests that large firms are more sensitive to intellectual property uncertainties because they rely heavily on formal rights to secure control and revenue from creative assets. This research contributes to a nuanced understanding of how legal frameworks for AI may shape the gig economy's AI art-related creative services, offering valuable guidelines for more informed decision-making by freelancers, clients, platform owners, and policymakers in this evolving landscape.