The Societal Impact of Sharing Economy Platform Self-Regulations—An Empirical Investigation

• Published in: Information systems research 2022-12, Vol.33 (4), p.1303-1323
• Main Authors: Han, Wencui, Wang, Xunyi, Ahsen, Mehmet Eren, Wattal, Sunil
• Format: Article
• Language: English
• Subjects: Airbnb; Crime; difference in differences; Economic growth; Economic policy; geographically weighted regression; home sharing; Impact analysis; Reduction; Regulations; Self regulation; Sharing economy; societal impacts; Theft
• ISSN: 1047-7047; 1526-5536
• DOI: 10.1287/isre.2021.1044

The rise of the sharing economy has disrupted traditional industries and has had many unforeseen societal impacts. This has sparked policy debates on whether and how the sharing economy should be regulated to promote the healthy growth of such markets. In this research, we examine the impact of platform self-regulations in the context of the home-sharing market. Using policy changes that reduce the number of Airbnb listings, we empirically test the impact of platform self-regulations on crime rates. Our results suggest that a reduction in Airbnb listings resulting from platform self-regulations leads to a reduction in crime. We further study the impact of these policy changes on different types of crime and find that these self-regulations lead to a reduction in incidents of crime such as assault, robbery, and burglary but an increase in theft incidents. In addition, we find that the impact of these policies varies based on the neighborhood’s characteristics, such as income, housing price, and population. This research contributes to our understanding of the societal impacts of the sharing economy and the impact of platform self-regulation. Our findings also provide empirical evidence to inform policy making. The rise of the sharing economy has disrupted traditional industries and has had many unforeseen societal impacts. This has sparked policy debates on whether and how the sharing economy should be regulated to promote the healthy growth of such markets. In this research, we examine the impact of platform self-regulations in the context of the home-sharing market. Using policy changes that reduce the number of Airbnb listings, we deploy a difference-in-difference approach to empirically test the impact of platform self-regulations on crime rate. Our results suggest that a reduction in Airbnb listings resulting from platform self-regulations leads to a reduction in crime. We further study the impact of these policy changes on different types of crime and find that these self-regulations lead to a reduction in incidents of crimes such as assault, robbery, and burglary but an increase in theft incidents. In addition, we use geographically weighted regression to investigate the heterogeneous effects of Airbnb occupancy on different types of neighborhoods, and we show that income, housing price, and population moderate the impact of the regulations. This research contributes to our understanding of the societal impacts of the sharing economy and the impact o