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What is the value of being a superhost ?

Author

Listed:
  • Aleksander Berentsen

    (Unibas - Université de Bâle = University of Basel = Basel Universität)

  • Mariana Rojas Breu

    (LEDa - Laboratoire d'Economie de Dauphine - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres)

  • Christopher Waller

    (Deakin University [Melbourne Burwood])

Abstract

We construct a search model where sellers post prices and produce goods of unknown quality. A match reveals the quality of the seller. Buyers rate sellers based on quality. We show that unrated sellers charge a low price to attract buyers and that highly rated sellers post a high price and sell with a higher probability than unrated sellers. We fi nd that welfare is higher with a ratings system. Using data on Airbnb rentals, we show that Superhosts and hosts with high ratings: 1) charge higher prices, 2) have a higher occupancy rate and 3) higher revenue than average hosts.

Suggested Citation

  • Aleksander Berentsen & Mariana Rojas Breu & Christopher Waller, 2019. "What is the value of being a superhost ?," Working Papers hal-02305037, HAL.
  • Handle: RePEc:hal:wpaper:hal-02305037
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    Cited by:

    1. is not listed on IDEAS
    2. Hanspach, Philip & Sapi, Geza & Wieting, Marcel, 2024. "Algorithms in the marketplace: An empirical analysis of automated pricing in e-commerce," Information Economics and Policy, Elsevier, vol. 69(C).

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    Keywords

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    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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