Real Effects of Peer-to-Peer Rental: Evidence from Airbnb

44 Pages Posted: 12 Feb 2018 Last revised: 28 Jan 2019

See all articles by Yifei Mao

Yifei Mao

Cornell University - SC Johnson College of Business - Finance Department

Xuan Tian

Tsinghua University - PBC School of Finance

Kailei Ye

University of North Carolina (UNC) at Chapel Hill - Kenan-Flagler Business School

Date Written: January 27, 2019

Abstract

We study how a pioneer of peer-to-peer rental, Airbnb, affects the local economy. Using venture capital infusions as plausibly exogenous shocks to Airbnb’s expansion into a new county, we find that Airbnb expansion leads to poorer hotel performance in the local county. Meanwhile, Airbnb expansion appears to increase local employment and household income. Further analysis suggests that increased employment is concentrated in industries that are complementary to Airbnb’s business and in employee groups with a lower level of skills. Our study highlights the impact of peer-to-peer rental marketplaces on the local economy and provides important policy implications.

Keywords: airbnb, sharing economy, hotel performance, unemployment, household income

JEL Classification: G22, G29, D31, J21

Suggested Citation

Mao, Yifei and Tian, Xuan and Ye, Kailei, Real Effects of Peer-to-Peer Rental: Evidence from Airbnb (January 27, 2019). Kelley School of Business Research Paper No. 18-15. Available at SSRN: https://ssrn.com/abstract=3111975 or http://dx.doi.org/10.2139/ssrn.3111975

Yifei Mao (Contact Author)

Cornell University - SC Johnson College of Business - Finance Department ( email )

Ithaca, NY 14850
United States

Xuan Tian

Tsinghua University - PBC School of Finance ( email )

No. 43, Chengfu Road
Haidian District
Beijing 100083
China
+86-10-62794103 (Phone)

HOME PAGE: http://xuantian.info/

Kailei Ye

University of North Carolina (UNC) at Chapel Hill - Kenan-Flagler Business School ( email )

McColl Building
Chapel Hill, NC 27599-3490
United States

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