How digital nomads impact local communities: A Chiang Mai case study
Digital nomads can be catalysts for economic and cultural change. New research examines their impact on Chiang Mai and the implications for other cities
Digital nomadism is an increasingly popular and viable lifestyle for many workers around the world. The World Economic Forum estimates there are 63 million digital nomads globally, and other research suggests their collective economic value is approximately US$787 billion per year (calculated as the aggregate of digital nomad spending annually). In the US alone, around 17.3 million workers (about 11 per cent of the working population) describe themselves as digital nomads.
Governments worldwide have recognised the value that digital nomadism can add to their local economies. In response, almost 60 countries now offer digital nomad visas, which provide temporary residency for the purposes of working remotely via a computer or laptop to a foreign-based employer or business.
Digital nomadism represents a significant shift in the global work landscape, according to Dr Michael Cahalane, Senior Lecturer in the School of Information Systems and Technology Management at UNSW Business School. This shift not only impacts traditional work paradigms, but also has profound effects on the economies and cultures of host communities, according to research recently conducted by Dr Cahalane, Dr Angtyasti Jiwasiddi (PhD graduate), Emerita Professor Dubravka Cecez-Kecmanovic, and Associate Professor Carmen Leong (all from the School of Information Systems and Technology Management at UNSW Business School) as well as Peter Ractham, Professor at Thammasat University in Thailand, and Daniel Schlagwein, Professor of Digital Work and Organisation at The University of Sydney, who has pioneered digital nomadism as a research topic.
Chiang Mai: a case study on the impact of digital nomads
In their paper, Digital nomadism as a new part of the visitor economy: The case of the “digital nomad capital” Chiang Mai, Thailand, the researchers examined the impact of digital nomads on local communities by way of a study of the impact of digital nomadism on Chiang Mai, a city in Thailand that is widely considered the ‘digital nomad capital’ of the world. Chiang Mai is one of the most popular locations for digital nomads looking to take advantage of favourable currency exchange rates, lower living costs and richer cultural experiences. With a large and well-visible population of digital nomads, Chiang Mai was an ideal case study for the purposes of the research, according to Professor Cecez-Kecmanovic.
“Our research was motivated by the lack of understanding of the role and impact of digital nomadism on local communities, their cultures and economies,” explains Professor Cecez-Kecmanovic, who says the research specifically addresses contradicting claims and misconceptions in the literature due to predominantly ‘Western’ perspective and the focus on digital nomads’ views. “We therefore conducted our empirical research in situ with local citizens from Chiang Mai to get their views on digital nomads and attend to their voices in the assessment of digital nomads’ impacts on the local community.”
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How has digital nomadism impacted Chiang Mai?
The research uncovered key findings about the impact of digital nomads on Chiang Mai, according to Professor Schlagwein, who has worked with the Government of Thailand previously and travelled with Dr Jiwasiddi for their fieldwork. Importantly, digital nomadism has had both positive and negative impacts on local communities, which Professor Schlagwein said shapes the phenomenon of digital nomadism, in that local communities (both the people and the environment) were often relegated to a “tropical backdrop” and either overlooked in the discourse on digital nomadism, or not really consulted for their views but instead had assumptions made about them.
On the positive side, for example, digital nomadism has contributed to the rise of coworking spaces, hubs, and co-living spaces, according to Dr Angtyasti Jiwasiddi. These exemplify new business opportunities for local businesses, which serve as an important contribution to the community. Furthermore, activities in the coworking spaces and hubs can also include local citizens – not only as employees but also as participants in workshops and training sessions.
Beyond utilising digital platforms for remote work or personal branding, Dr Jiwasiddi said digital nomads often cultivate their own local online communities through platforms such as Facebook or Instagram. “These digital hubs sometimes serve as vital channels for digital nomads’ engagement and interaction with the local people, facilitating mutual understanding, job opportunities, community events, information sharing, and exchange of opinions,” she said.
More broadly, the research found that digital nomads contribute to knowledge sharing and engagement of locals in work activities, job creation and recruitment within the local community. “Their longer stays (compared to tourists) enable their engagement in work and social activities, that foster a stronger connection to the local community,” Dr Jiwasiddi added. “Consequently, they are more inclined to organise events that facilitate knowledge transfer and extend employment opportunities to locals.”
Digital nomadism and the evolution of Chiang Mai
Digital nomadism has contributed significantly to Chiang Mai’s appeal as a visitor destination, and Professor Schlagwein said digital nomads constitute a sizable portion of the city’s economy. “As I mentioned to Thai officials while discussing a digital nomad visa, and later when consulted on designing a digital nomad recruiting website, Chiang Mai could well become the ‘Singapore of remote work’,” he said.
Beyond typical visitor revenue (which is somewhat more widely distributed through platforms like AirBnBs, compared to mass tourism), he said Chiang Mai has experienced spillover effects, such as locals participating in startups, technology events, or seeking remote contracts. “Thus, digital nomads contribute not just financially but also leave behind knowledge and open opportunities not previously accessible to the local community,” he said. “Comparing our investigation of five case studies worldwide, Chiang Mai illustrates a significant variance in how local communities perceive and engage with digital nomads.”
The research paper also highlighted the potential for other economies around the world to benefit from digital nomadism. “Chiang Mai’s ‘evolution’ into a hub for digital nomads highlights the potential for cities to diversify their economies by attracting remote workers,” said Dr Cahalane.
“The development of infrastructure to support this demographic, such as reliable internet and coworking spaces, has not only catered to the needs of digital nomads but also improved the digital infrastructure for locals. The case of Chiang Mai demonstrates how cities can leverage the digital nomad trend to stimulate local entrepreneurship, boost the service sector, and foster a vibrant, multicultural community that benefits from fresh perspectives and global connections.”
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Emerita Professor Cecez-Kecmanovic added that a better and more comprehensive understanding of the distinct contribution of digital nomads to local development and the visitor economy (different from tourists and other visitors) is an important finding. “Importantly, digital nomads may be seen as a type of visitors whose contribution is more aligned with UN sustainable development goals,” she said.
Optimising the digital nomad experience and economy
There are a number of important implications in the research for digital nomads, local communities and governments seeking to attract more digital nomads, according to Dr Jiwasiddi. Firstly, she said digital nomads should recognise their potential to contribute positively to the local community – while also being culturally sensitive, which is an important point that emerged in the research. “Digital nomads should strive to understand and respect the local culture, customs, and social norms. This cultural sensitivity can significantly enhance their experience and interactions within the community,” she explained.
Dr Jiwasiddi, who has also conducted a case study of digital nomadism’s impact in Bali (to be published soon), said local communities can benefit from digital nomadism by developing policies and implementing initiatives that attract digital nomads, while also navigating the potential negative impacts and challenges that arise from the influx of digital nomads, Dr Jiwasiddi said. “Local communities can use this opportunity to foster vibrant communities that are welcoming to digital nomads while also strategically navigating the potential challenges, such as cultural clashes and socioeconomic disparity,” she noted.
Collaboration between local communities and digital nomads can be highly beneficial. “Knowledge transfer, such as IT training and working online, or collaboration on projects can be mutually advantageous,” Dr Jiwasiddi said. “Maintaining a balanced perspective on digital nomads entails recognising both the negative impacts and the opportunities associated with digital nomadism. Understanding these dual perspectives can empower locals to navigate challenges effectively and participate in activities that can mutually benefit digital nomads and local communities.”
Governments should also recognise the potential of digital nomadism in stimulating the local economy and develop targeted policies and initiatives to regulate and attract digital nomads. Practical steps may include introducing digital nomad visas, fostering strategic partnerships with local coworking and co-living spaces, enhancing digital platforms tailored to digital nomads, and forging collaborations with tourism departments.
As digital nomads are typically freelancers, consultants or entrepreneurs who use IT-related resources for digital work, developing infrastructure like reliable internet access and affordable semi-long-term accommodation is crucial, as is creating community spaces conducive to remote work. These proactive measures can bolster a region’s appeal to digital nomads while simultaneously capitalising on their economic potential.
Capitalising on digital nomadism: advice for local leaders
Understanding the unique needs of digital nomads is key, and this is where research can provide valuable insights. “Reliable internet access, affordable semi-long-term accommodation, and vibrant community spaces conducive to remote work are some of the things that local communities should be aware of to attract and benefit from digital nomadism,” Dr Jiwasiddi said.
Fostering vibrant communities by encouraging interactions between digital nomads and the local community can open up pathways to create mutual understanding and collaboration. She suggested that this can be achieved by organising networking events, cultural exchanges, and workshops to facilitate interaction and knowledge exchange.
Ultimately, the local community must understand the characteristics and paradigm changes of people working and travelling (such as digital nomads) as part of these changes. This will allow them to look at visitors from different perspectives and understand that they may build a more sustainable approach to benefit from the trend while also acknowledging that it may have negative impacts, such as gentrification and socio-economic disparity. Therefore, having sustainable practices that mitigate potential negative impacts is important.
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“We have recognised that digital nomads can potentially provide the local community with more sustainable job solutions, such as providing locals with knowledge to work digitally instead of low-manual labour like waiters and cleaners that typically cater to the tourism industry,” Dr Jiwasiddi added.
“I think digital nomads have a genuine desire to interact with the locals,” said Associate Professor Leong. “However, navigating language and cultural differences can pose significant challenges for both visitors and locals alike. Local leaders could explore how they can provide more opportunities for the two sides to know more about each other and create further avenues for employment and cultural exchanges. From the case of Chiang Mai, it is evident that these opportunities to interact could cultivate richer exchanges that benefit both residents and digital nomads.”