Platform, Anonymity, and Illegal Actors: Evidence of Whac-a-Mole Enforcement From Airbnb

39 Pages Posted: 9 Nov 2018

See all articles by Jian Jia

Jian Jia

Illinois Institute of Technology - Stuart School of Business

Liad Wagman

Rensselaer Polytechnic Institute (RPI) - Lally School of Management & Technology

Multiple version iconThere are 2 versions of this paper

Date Written: September 1, 2018

Abstract

Airbnb, a prominent sharing-economy platform, offers dwellings for short-term rent. Despite restrictions, some sellers illegally offer their accommodations, taking advantage of a degree of anonymity proffered by the platform to hide from potential enforcement. We study the extent to which enforcement works in Manhattan, one of the most active short-term rental markets, by testing the effects of two recent enforcement events. We demonstrate that prices of entire-home listings in Manhattan increase and vacancies decrease following each enforcement event, suggesting that illegal entire-home listings are being withdrawn from the market, with these effects varying depending on neighborhood characteristics. We further demonstrate that a significant portion of withdrawn listings re-enter the market under the less-enforced listing category of private rooms.

Keywords: Enforcement, Anonymity, Short-Term Rentals, Platform, Illegal Supply

JEL Classification: K42, L51, R52

Suggested Citation

Jia, Jian and Wagman, Liad, Platform, Anonymity, and Illegal Actors: Evidence of Whac-a-Mole Enforcement From Airbnb (September 1, 2018). NET Institute Working Paper No. 18-01, October 2018, Available at SSRN: https://ssrn.com/abstract=3265617 or http://dx.doi.org/10.2139/ssrn.3265617

Jian Jia

Illinois Institute of Technology - Stuart School of Business ( email )

Stuart Graduate School of Business
565 W. Adams St. 4th floor
Chicago, IL 60661
United States

Liad Wagman (Contact Author)

Rensselaer Polytechnic Institute (RPI) - Lally School of Management & Technology ( email )

110 8th St
Troy, NY 12180
United States

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