Entry of Providers Onto a Sharing Economy Platform: Macro-Level Factors and Social Interaction

Abstract

Despite the recent proliferation of sharing economy platforms, little is known about what drives providers (individual people who own assets) to enter onto a sharing economy platform. The platform does not own the assets that underlie transactions but depends on individuals to provide them. In the burgeoning market of home rental properties, we investigate the role of macro-level factors to explain geographical differences in the number of entries of providers with diverse motivations onto a sharing economy platform. Using a sample of listings posted by property owners on the Airbnb platform across different cities in Spain between 2010 and 2015, we examine how social and economic motivations of providers interact with macro-level antecedents to affect their entry. We show that macro-level drivers have a different effect on the entry of providers depending on the degree of face-to-face interaction between host and guest. We find that industry growth and the availability of underused assets increase the entry onto the platform of hosts who have little face-to-face interaction with guests, while the strictness of regulation decreases their entry. By contrast, the entry of hosts with high face-to-face interaction with guests is not affected by these factors. We discuss theoretical and research implications of the role of social interaction in provider entry and offer practical advice for those in the sharing economy about the role of social interaction in driving providers onto their platforms.

Sharing economy research in hospitality and tourism: a critical review using bibliometric analysis, content analysis and a quantitative systematic literature review

“…This observation was especially evidenced in the disciplinary foci of extant research-consumer behavior and social psychology and economics and revenue management-and on the focus on outcomes variables of relevance mainly to the meso and micro-level domains of the sharing economy. On the other hand, research outside of the field of hospitality and tourism has begun to examine macro-level issues such as the factors that influence the entry of sharing economy providers, including industry growth, and how the availability of underutilized resources increases entry onto the platforms while the strictness of regulation reduces the likelihood of entry (Gerwe et al, 2020).…”

The Distinctive Domain of the Sharing Economy: Definitions, Value Creation, and Implications for Research

“…Many types of platform exist (e.g., Baldwin and Woordward, 2009), and useful typologies are provided in the literature. These include collaboration platforms , where members cooperate to produce goods (Cusumano, in press; Gallus, 2017; O’Mahoney and Ferraro, 2007); exchange platforms , in which parties buy, sell, or swap products or services (Gerwe et al, in press; Lewis et al, in press; Reuber and Fischer, 2009; Taeuscher, 2019) or even digital assets (Benkler, 2006); and innovation platforms , where parties introduce complementary innovations (Boudreau and Lakhani, 2009; Nambisan et al, 2018; Srinivasan and Venkatraman, 2018). Cusumano et al (2019, p. 20) define transaction platforms as ‘intermediaries or online marketplaces that make it possible for people and organizations to share information or to buy, sell, or access a variety of goods and services’.…”

A decade of systematic literature review on Airbnb: the sharing economy from a multiple stakeholder perspective

“…(2020) e. Host motivations Economic opportunities Social benefits Macro-level determinants National cultural values The decision to host on Airbnb Host-guest interaction level Dogru et al. (2020c) ; Farmaki and Stergiou (2019) ; Gerwe et al. (2020) ; Gupta et al.…”