Paper Number

2319

Paper Type

Complete

Description

Disintermediation, where providers and customers transact bypassing an intermediary, has challenged the business model and dwindled profits of the multi-billion-dollar platform economy. Despite the platforms’ efforts to mitigate disintermediation, little is known regarding the extent of disintermediation or efficacy of the mitigation policies, largely due to unobservability of disintermediation. We tackle these challenges by designing a geo-analytic methodology to identify and quantify disintermediation by matching online Airbnb booking and offline granular mobile location data. We further leverage DiD with matching samples to causally examine the efficacy of four Airbnb policies; and finally propose a cost-and-benefit conceptual framework to interpret the findings and guide platform designs of mitigation policies. We find, for instance, a 5.4% of disintermediation in Austin, TX over Summer 2019; and Instant Bookable reduces disintermediation by 9%, with a stronger effect among the hosts without preference for long-term lease, with more repeated guests, and more hosting experience.

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Dec 12th, 12:00 AM

Disintermediation and Its Mitigation in Online Two-sided Platforms: Evidence from Airbnb

Disintermediation, where providers and customers transact bypassing an intermediary, has challenged the business model and dwindled profits of the multi-billion-dollar platform economy. Despite the platforms’ efforts to mitigate disintermediation, little is known regarding the extent of disintermediation or efficacy of the mitigation policies, largely due to unobservability of disintermediation. We tackle these challenges by designing a geo-analytic methodology to identify and quantify disintermediation by matching online Airbnb booking and offline granular mobile location data. We further leverage DiD with matching samples to causally examine the efficacy of four Airbnb policies; and finally propose a cost-and-benefit conceptual framework to interpret the findings and guide platform designs of mitigation policies. We find, for instance, a 5.4% of disintermediation in Austin, TX over Summer 2019; and Instant Bookable reduces disintermediation by 9%, with a stronger effect among the hosts without preference for long-term lease, with more repeated guests, and more hosting experience.

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