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What’s mine is yours—but at what price? Dynamic pricing behavior as an indicator of Airbnb host professionalization

Author

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  • Jeroen Oskam

    (Hotelschool The Hague)

  • Jean-Pierre Rest

    (Leiden University)

  • Benjamin Telkamp

    (Leiden University)

Abstract

This paper seeks to clarify the nature of the urban vacation rental business, in particular in relation to the so-called “Sharing Economy,” by analyzing the dynamic pricing behavior of Airbnb hosts in Amsterdam. It explores Airbnb’s host “professionalization,” building on the strategic management literature showing efficient pricing behavior to be the result of an acquired capability required to interpret complex and incomplete information. Through an analysis of 11,264,907 daily observations from 32,815 units, it finds that hosts who adjust their prices more frequently outperform others in RevPAR, ADR, and occupancy. Specifically, it finds that the number of properties per host (as an indicator of Airbnb professionalization) is positively associated with RevPAR, ADR, occupancy, and number of reviews through the number of negative price changes, respectively mean negative price change, and that this effect differs depending on the level of the number of positive price changes, respectively mean positive price change. Implications for social and academic perspectives on Airbnb as “Sharing,” and research on the externalities of urban vacation rentals are discussed.

Suggested Citation

  • Jeroen Oskam & Jean-Pierre Rest & Benjamin Telkamp, 2018. "What’s mine is yours—but at what price? Dynamic pricing behavior as an indicator of Airbnb host professionalization," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 17(5), pages 311-328, October.
    • Handle: RePEc:pal:jorapm:v:17:y:2018:i:5:d:10.1057_s41272-018-00157-3
    DOI: 10.1057/s41272-018-00157-3
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    References listed on IDEAS

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    Cited by:

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    2. Giulia Contu & Luca Frigau & Marco Ortu, 2023. "VGLM proportional odds model to infer hosts’ Airbnb performance," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(5), pages 4069-4094, October.
    3. Sauveur Giannoni & Daniel Brunstein & Florian Guéniot & Johan Jouve, 2021. "Multichannel distribution strategy of Airbnb hosts," Post-Print hal-03216572, HAL.
    4. Scott M. Kaplan, 2022. "Putting a price on popularity: Evidence from superstars in the National Basketball Association," Economic Inquiry, Western Economic Association International, vol. 60(3), pages 1357-1381, July.
    5. Guizzardi, Andrea & Mariani, Marcello M. & Stacchini, Annalisa, 2022. "A temporal construal theory explanation of the price-quality relationship in online dynamic pricing," Journal of Business Research, Elsevier, vol. 146(C), pages 32-44.
    6. Martin Petricek & Stepan Chalupa & Karel Chadt, 2020. "Identification of Consumer Behavior Based on Price Elasticity: A Case Study of the Prague Market of Accommodation Services," Sustainability, MDPI, vol. 12(22), pages 1-14, November.
    7. Abrate, Graziano & Sainaghi, Ruggero & Mauri, Aurelio G., 2022. "Dynamic pricing in Airbnb: Individual versus professional hosts," Journal of Business Research, Elsevier, vol. 141(C), pages 191-199.
    8. Xiang, Diandian & Li, Xia & Hampson, Daniel Peter, 2023. "Service exchange activities in the sharing economy: Professional versus amateur peer providers," Technological Forecasting and Social Change, Elsevier, vol. 196(C).
    9. Türk, Umut & Östh, John & Kourtit, Karima & Nijkamp, Peter, 2021. "The path of least resistance explaining tourist mobility patterns in destination areas using Airbnb data," Journal of Transport Geography, Elsevier, vol. 94(C).
    10. Cui, Yuanyuan (Gina) & van Esch, Patrick & Das, Gopal & Jain, Shailendra, 2022. "“Surge price precision and political ideology”," Journal of Business Research, Elsevier, vol. 143(C), pages 214-224.
    11. Sainaghi, Ruggero & Chica-Olmo, Jorge, 2022. "The effects of location before and during COVID-19," Annals of Tourism Research, Elsevier, vol. 96(C).
    12. Meijian Yang & Enjun Xia, 2021. "A Systematic Literature Review on Pricing Strategies in the Sharing Economy," Sustainability, MDPI, vol. 13(17), pages 1-28, August.
    13. Emeka Ndaguba & Cina Van Zyl, 2023. "Professionalizing Sharing Platforms for Sustainable Growth in the Hospitality Sector: Insights Gained through Hierarchical Linear Modeling," Sustainability, MDPI, vol. 15(10), pages 1-24, May.

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