The Airbnb paradox: Positive employment effects in the hospitality industry

Abstract

The purpose of this study is to examine the extent to which Airbnb supply affects employment in the hospitality, tourism, and leisure industries. Accordingly, we analyzed the effects of Airbnb supply on various sectors in the hospitality, tourism, and leisure industries in 12 major metropolitan statistical areas in the United States for theperiod between July-2008 and February-2018. The results showed that Airbnb supply positively affects employment in all sectors of the hospitality, tourism, and leisure industries. The magnitudes of these effects are not only statistically but also economically significant. Although prior studies have showed that Airbnb has an adverse impact on hotels’ financial performance measures, our results show that employment in the hotel sector increases with increased Airbnb listings. While this outcome might be contradictory to the general conjecture, such evidence calls for a comprehensive investigation of Airbnb’s overall economic impact. Research and practical implications are further discussed.