The exhaustion of the herding effect in peer-to-peer accommodation

Beatriz Benítez-Aurioles ^[1]
1. [1] Universidad de Málaga
  
  Universidad de Málaga
  
  Málaga, España
Localización: Tourism economics: the business and finance of tourism and recreation, ISSN 1354-8166, Vol. 28, Nº. Extra 1, 2022 (Ejemplar dedicado a: Post-COVID-19 Tourism Economics and Economic Geography Research), págs. 27-43
Idioma: inglés
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Resumen
- A significant reason for the concentration of demand in a subset of the supply in the peer-to-peer market for tourist accommodation is herding behavior, by which the decisions of the first guests are imitated by those who follow. This article proposes a profit- and utility-maximization microeconomic model and implements it with data of Airbnb listings corresponding to 10 European cities. Results show that the influence of each additional review is positive but decreasing, inducing a more balanced distribution of demand among offered accommodation and thus dampening the herding effect. Moreover, reservation policy—specifically, enabling the instant booking option—is a key to explain the initial push that accommodations need to be demanded now and, hence, to increase their possibilities of being demanded in the future.