The Sharing Economy and Housing Affordability: Evidence from Airbnb

62 Pages Posted: 25 Jul 2017 Last revised: 10 Apr 2018

See all articles by Kyle Barron

Kyle Barron

National Bureau of Economic Research

Edward Kung

University of California, Los Angeles (UCLA)

Davide Proserpio

Marshall School of Business, University of Southern California

Date Written: March 29, 2018

Abstract

We assess the impact of home-sharing on residential house prices and rents. Using a dataset of Airbnb listings from the entire United States and an instrumental variables estimation strategy, we find that a 1% increase in Airbnb listings leads to a 0.018% increase in rents and a 0.026% increase in house prices at the median owner-occupancy rate zip code. The effect is moderated by the share of owner-occupiers, a result consistent with absentee landlords reallocating their homes from the long-term rental market to the short-term rental market. A simple model rationalizes these findings.

Keywords: Sharing Economy, Peer-To-Peer Markets, Housing Markets, Airbnb

JEL Classification: R31, L86

Suggested Citation

Barron, Kyle and Kung, Edward and Proserpio, Davide, The Sharing Economy and Housing Affordability: Evidence from Airbnb (March 29, 2018). Available at SSRN: https://ssrn.com/abstract=3006832 or http://dx.doi.org/10.2139/ssrn.3006832

Kyle Barron

National Bureau of Economic Research ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Edward Kung (Contact Author)

University of California, Los Angeles (UCLA) ( email )

405 Hilgard Avenue
Box 951361
Los Angeles, CA 90095
United States

Davide Proserpio

Marshall School of Business, University of Southern California ( email )

701 Exposition Blvd
Los Angeles, CA Los Angeles 90089
United States

HOME PAGE: http://www-bcf.usc.edu/~proserpi/

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