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Online Travel Agencies and Beyond: The Role of Sales Channels for Hotels and Consumers

Author

Listed:
  • Lasio Laura

    (European Commission, Joint Research Centre, Ispra, Italy)

  • Jack (Peiyao) Ma

    (University of Oxford, Oxford, UK)

  • Andrea Mantovani

    (TBS Business School, Toulouse, France)

  • Carlo Reggiani

    (European Commission JRC, Seville, Spain and Department of Economics, University of Manchester, Manchester, UK)

  • Néstor Duch-Brown

    (European Commission, Joint Research Centre, Seville, Spain)

Abstract

This paper examines the impact of online travel agencies on hotel pricing strategies, consumer behavior, and market dynamics within the hospitality sector. Using channel-level proprietary data from major hotel chains across eight European countries, we adopt a structural approach to estimate demand and supply, and simulate policy counterfactuals. Our findings reveal that online travel agencies expand demand without exerting significant competitive pressure on market prices, due to limited substitutability between sales channels. We assess potential regulatory interventions. A fee cap would benefit hotels in the sample and consumers, while hurting outside competitors. Provisions that facilitate direct communication between hotels and customers, in the spirit of the disintermediation allowed by the DMA, would be successful in shifting some sales from the platform to the hotel website while reducing margins overall.

Suggested Citation

  • Lasio Laura & Jack (Peiyao) Ma & Andrea Mantovani & Carlo Reggiani & Néstor Duch-Brown, 2025. "Online Travel Agencies and Beyond: The Role of Sales Channels for Hotels and Consumers," Working Papers 25-07, NET Institute.
    • Handle: RePEc:net:wpaper:2507
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    File URL: http://www.netinst.org/Peiyao_25-07.pdf
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    Keywords

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    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • K20 - Law and Economics - - Regulation and Business Law - - - General
    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

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